europe
A MASTERFUL CONSENSUS BUILDER CEFICs Hugo Lever hands over the reins after 20 years of steering through political, societal minefields Patricia Layman Short C&EN London
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t the end of January, the man who has quietly guided the European chemical industry for the past 20 years, Hugo Lever, retired as director general of CEFIC, the European Chemical Industry Council. Lever's successor is Alain Perroy, Rhone-Poulenc vice president for health, safety, and environment. In a wideranging interview with C&EN prior to his retirement, Lever reflected on some of his accomplishments while at CEFIC and on the challenges ahead for Perroy. Lever's record will be hard to match, both in terms of longevity and accomplishment. When he joined CEFIC as assistant director general in April 1978, the organization was pretty much what its name then implied: the European Council of Chemical Manufacturers Federations. It was founded in 1972 as a loose-knit Brussels-based federation of the chemical industry associations of 15 European countries. CEFIC is still based in Brussels, but now it consists of the national chemical industry associations of 16 countries and six associate countries. Its members also include multinational chemical companies and associations and groups in affiliated or enduse chemical sectors. CEFIC is a founding participant of ICCA, the International Council of Chemical Associations. And it is generally considered to be one of the most effective industry groups dealing with the European Commission, the administrative arm of the European Union. The director of one national indus-
try association comments: "Hugo is the most cunning political animal I have ever known. I mean that in the best possible sense. He has been able to accomplish what he has because he knows how to work with people, how to balance and resolve tensions between different groups." Jtirgen Dormann, a former CEFIC president who is chairman of Aventis, the Strasbourg, France-based result of the merger of Hoechst and RhonePoulenc, adds: "During his term of office, Hugo Lever stood by 11 CEFIC presidents. He succeeded in combining the many national and segment-specific interests in our industry and in making the organization an authoritative and respected dialogue partner for political institutions in the EU. Moreover, by supporting the associate membership of East European federations, he made a
forward-looking contribution to panEuropean unification." Lever was born in 1936 in Harderwijk, the Netherlands, and received a doctoral degree in economics from Nederlandse Economische Hogeschool (now Erasmus University), in Rotterdam. His first job was with fertilizer producer Albatros Superfosfaatfabrieken, of the Netherlands; subsequently he joined chemicals and pharmaceuticals producer Fisons, first in Brussels and then as managing director of Fisons, South Africa. When investment plans he had been responsible for there fell through, he resigned and returned to Brussels in 1978. He followed all the normal job-hunting routes at that time: contacting headhunted, following job advertisements, and so on. "I happened to remember a guy in the pharmaceuticals association, and started looking for him in the phone book," Lever recalls. "I saw CEFIC mentioned, and talked with them. "I had a quick interview, but it took three months before I got the job. They offered me a job by telex: They didn't tell me what job, what salary, or anything much." He came in as the assistant director general, and a couple of years after that, in June 1981, took over the functions of the then-director general, whose contract was not renewed. "I thought maybe it would be for a brief time—I would get to know some chemical companies and eventually join one of them," Lever comments. The brief time has, instead, stretched nearly 20 years. And throughout that time, he grins, "I have kept the CEFIC men| tion in the telephone book." !w The organization that Lever inherited consisted of a small permanent | staff with a small annual budget The staff was augmented by advisers to the Jo president, who were temporary con[£ sultant delegates from chemical companies. While such temporary advisers were welcome, Lever says, "there was no stability." For example, a chemical company supplying an adviser would also contribute 1 million Belgian francs [approximately $25,000] to CEFIC, but when the person left, Lever points out, "there went the money." So one of his first steps was to develop the concept of associate company membership, which brought multinational chemical producers Lever today (left) and at the beginning of his tenure (inset) as head of the European Chemicai Industry Council. FEBRUARY 14, 2000 C&EN
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europe into formal—albeit associate—ties with CEFIC, with a standard membership fee. The national associations remained the full, fee-paying members. That development, he says, "gave me more realistic budget possibilities." He adds that it also "gave us the possibility to make American companies involved, too," although the suggestion generated significant controversy when first broached. Involving the European subsidiaries of American companies "was important. It gave CEFIC a more international outlook." That became increasingly important as European coordination began progressing dramatically toward the single market target of 1992. European governmental coordination in turn demanded the capability of a unified response from the region's chemical industry. In 1991, a program designed to shape CEFIC for the next decade, dubbed CEFIC 2000, gave the organization its next major change. That program restructured the organization, creating a board of directors and two assemblies—one of national associations and federations, the other of qualifying multinational corporations. The changing nature of the issues and the increasingly negative public impression of the chemical industry spurred CEFIC's most recent change in the late 1990s. Aventis' Dormann notes that "during my presidency in 1997 and 1998, we reorganized CEFIC to give equal status to all members, including the affiliated organizations and sector groups. We realigned our relations with other associations, especially EFPIA [the European Federation of Pharmaceutical Industry Associations] and EuropaBio [the European Association for Bioindustries], and deepened worldwide cooperation," with ICCA The new structure features three legs: national associations, multinational companies, and affiliated organizations. According to Lever, 'The problem for the industry is at the interface between suppliers and customers in the sector groups. With the latest generation of chief executives, there are few people of vision—they are glorified product managers, with just one or two products. If you have no vision of the industry as a whole, you cannot improve the reputation of your own company," let alone the industry. 'The chemical industry is in the firing line," he says. "We need to grab every opportunity to become a more integrated 42
FEBRUARY 14, 2000 C&EN
Shtral and Eastern Europe. CEFIC has six associate members: the national associations offiveCentral European countries— the Czech Republic, Hungary, Poland, Slovakia, and Slovenia—and that of Turkey. When will these associations be welcomed as full members? 'They can become full members when their countries are capable of joining the EU," Lever says. That flexibility allows the chemical industries of Norway and Switzerland, for example, to be members of CEFIC although the countries themselves are not members of the EU. 'The problem is to explain to these associations why they can't become full members. This is a very sensitive area, very difficult," he says. CEFIC has teamed up with the EC in what is called the Phare program, which helps bring environmental, safety, and health standards up to snuff in the associate member industries to meet EU regulations covering the industry. However, Lever grumbles, "at the same time, 'Greens' and the Scandinavian countries are trying to change the chemical legislation— they are changing the rules as we are trying to teach them" to the Central Euroety of major chemical companies as a pean industries. measure of financial, environmental, Although a European-wide approach and societal performance. "It is not enough," he says, "for the industry just is increasingly important, Lever insists to create profits and options for manag- that national associations remain cruers. In a liberal country, you cannot stop cially important to the health of the insomeone making money. But if I see dustry in the region. For one thing, he companies with the top brass dividing says, "national associations rear the the money between them and kicking bosses" that will eventually take over out staff because it is too expensive, I European chemical companies. They have trouble with that. If we want to sur- also provide a forum for smaller compavive in the long run, we must have a nies whose concerns are more local or longer timeline than the next options." regional. And that in turn feeds through The organization's governmental re- to influence for CEFIC. "Through the lations also are becoming increasingly national associations," he points out, "we difficult to handle, he says. In the past, represent 40,000 companies." Moreover, CEFIC's relations with the European although the EC proposes legislation, the Commission have been mixed. "Now, decisions are made by the EU's Council things are not so good, in my opinion— of Ministers, from the national governthere is an almost anti-industry feeling ments, with whom the associations can maintain a dialogue. in the commission." "I would like to see the situation One reason for that feeling, Lever suggests, is that "we have lived in prosperity where national associations deal with for so long, everything we need or want is their national concerns, and let us deal there for us. We begin to believe we don't with the supranational," he says, identihave to accept risks, and risks come from fying one of the ever-present tension industry. People go skydiving and bun- points between national associations gee jumping—there the risks cannot be and CEFIC. "But even now, they send big enough. But they don't want risks their own papers to the commission and from industry. Nobody sees how they can so on. They believe that the way to live with problems—they think that they maintain their birthright is to be seen by have no duties, only rights." their members to be doing everything." Lever also has been a staunch supHowever, he argues, "the commission porter of the chemical industries in Cen- people don't want to talk with the federapart of society as a whole. Sectors such as telecoms, sports shoes, autos, and so on—what would they be without chemicals? If we could go behind the scenes and make coalitions with customer associations, for example, we would get better organized services and also benefit from the specific skills." Increasingly, he suggests, the industry will be forced to look to "the triple bottom line" being espoused by a vari-
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europe tions and the association people—they want to talk with one set of people, from a European-wide organization. We try to embrace them [the associations], asking them to help us. We try to avoid loner' action. We need them—our [government relations specialist] cannot deal with all the European Parliament, and meet them all. Let's try to work with the national associations together, to ensure we are going in the same direction." That is true both in working with the European industry and with ICCA. "Bob Roland [Robert A. Roland, former president of the Chemical Manufacturers Association] and I spent 10 years getting ICCA off the drawing boards," he recalls, work that has been taken over and further developed by Roland's successor, CMA President Frederick L. Webber. "CMA is a different organization from CEFIC. CMA represents one country, one legal system, big companies, and so on," Lever says. 'With ICCA, we have a better understanding of the industry and a step toward pushing the chemical industry onto the global map."
The experience has been a particular pleasure, Lever says, in working with the different organizations and cultures represented at ICCA. For example, he says, "I have found it fascinating working with the Japanese delegates, to bring them out." That kind of work, however, is unseen and usually unappreciated, he observes. "Everything we do is taken for granted. People don't realize all we have to do to keep CEFIC together. You do hear stories about our being bureaucratic and slow, but we are frequently stopped in our tracks by someone in a country association or a company who doesn't think a decision is right, and wants it changed." And there have been many times, he recalls, when he was anything but slowmoving and bureaucratic, when he had to make a decision to catch the opportunity at hand before he had received authorization from the board of directors. * You need to know your support on the board, and you need to have credibility," he says. Credibility is a word that popped up frequently in the interview. Lever sees it
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as a crucial factor for successfully serving as a director general. 'The ideal director general," he says, "needs to like people, to relate, and come across in a credible way. You cannot learn that. It comes only if you are honest in what you are doing and saying." Lever also has found that "a knowledge of the industry helps. It helped that I had worked in many areas of the industry. But I didn't know chemistry—I didn't really need to know that. There was no job like this before; I was a bit of a pioneer. Probably I did a lot of things wrong, but I did a few things right." One of the things he insisted upon was the freedom to select his own staff rather than to accept appointees from the various companies and associations. "If they wanted me to be responsible, I had to be able to choose my own staff," he says. "I looked for people who would fit on the team—who could relate to people, who were flexible, and who could make people believe they meant what they said. I didn't need so many specialists—you can always find them. I wanted people intelligent enough to
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deal with situations, but most important, who were willing to work as a team to achieve something satisfactory. "We didn't want to be slaves to say only what the companies wanted us to," he adds. "If something was stupid, we would say so. And the same to the commission. My relations [as I leave] with the commission are probably difficult— that is the best thing to say." However, despite that need for bluntness, he says: "On the whole, I was rather lucky with the presidents [of CEFIC]. I grew older, too; in the beginning, I looked up to people more than I probably do now. "I would always need to work with someone genuine," he adds. "I want them to tell me to my face if something I do is wrong. Or if he says 'good', then it is good. And I have to be able to say the same to him. The solution has to be in the general interest, not saying things behind my back, or supporting his own interests rather than the general interest." Lever continues, "I say what I think— that's maybe my being Dutch. I believe I've accomplished things over the years
not by pretending I liked somebody. If I did not, I said so—in public. If you are working for the general interest, you can do that. Diplomacy doesn't mean being nice and polite, it means being honest. It also means knowing that if you want to go from A to B, the best way may not be in a
straight line. You must build up the consensus," he says, adding, "By the same token, people cannot feel they have been manipulated. You have to be open—this is what I want to do, because of this factor and this and this. This job only works if the membership accepts the decisions. There is a lot of behind-the-scenes work." Lever doesn't mention it, but others pick up on another quality that takes the sting out of the bluntness: humor. As Dormann puts it, "Whenever I am asked what his special qualities are and why it was such a pleasure to work with him, I reply: 'His skillful diplomacy, his international experience, his dedication to our industry, and—last but not least— his sense of humor.'" His ambitions now, Lever says, are to keep physically fit, to keep mentally fit, and "to do some things I really want to do." He looks forward to tackling repairs on the family retreat in rural France and to buffing up skills as an oil painter. The one thing he does not want is to lose touch with an industry in which he has been a major player for two decades.^
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