Jean-Luc Petithuguenin (Founder, Paprec): “Profit is the oxygen of a company, but it's only a means and not an end”

For Jean-Luc Petithuguenin, at the head of Paprec for 25 years, reconciling a quest for profit and an awareness for public interest is in no way utopian. The proof: a business which advocates ‘a greener planet and a more fraternal society,’ recycles 11 million tons of waste per year and generates a turnover of close to two billion euros.

For Jean-Luc Petithuguenin, at the head of Paprec for 25 years, reconciling a quest for profit and an awareness for public interest is in no way utopian. The proof: a business which advocates ‘a greener planet and a more fraternal society,’ recycles 11 million tons of waste per year and generates a turnover of close to two billion euros.


 

Leaders League. You claim to work for the common good with Paprec. Can you explain how, in concrete terms?

 

Jean-Luc Petithuguenin. By suggesting that each person recycle their waste rather than bury it, we are not simply looking to make a living. We want to work towards a greener planet and a more fraternal society. Some of our actions have a direct impact on the lives of others. Our network in India, for example, deals with waste discarded in the middle of the countryside so as to manage its transformation in the right way. In this way we are really changing the lives of local residents who before were being poisoned on a daily basis. There is an aspect which is far more important than this quest for profit.

 

However this does remain the objective of every business…

 

For me, profit is the oxygen of a company. Without it, we cannot develop, but it is not an end, rather a means. The purpose of a company is above all its durability.

 

Is this a philosophy that you share with your employees?

Of course. They are familiar with our ideas and they want to work for a company which has meaning.

 

What do other company heads think of your business model?

At the start, most of them thought it was idealistic to want to do good business with nice sentiments. The success of my group ‒ whose turnover has now risen to two million euros ‒, proves that this is possible. Those who doubted the model would work are now impressed and understand that giving meaning to a business is a way to be successful. That’s what I had wanted to demonstrate.

 

What advice would you give to young entrepreneurs who struggle to find this balance between the quest for profit and an awareness of public interest?

In my opinion, the key is time. You’ve got to ask yourself whether you want to invest for the next three years in order to resell the firm or if you want to invest for the next thirty years in order to hand it on. The more this approach is maintained in the long-term, the more it begins to build an awareness of public interest. The greediest entrepreneurs are generally to be found in sectors where money is turned over quickly. Those who want to create something more durable are likely to ask themselves: how can pollution be avoided? How can the consumer be reassured? By wanting to make cash as quickly as possible, it is impossible to take certain aspects into account, such as employee and supplier satisfaction and the pollution of the planet. Amoral capitalism is, in my opinion, time-bound.

 

Should the state take certain measures to encourage, or even force, companies to adopt more ethical practices?

Taking action for the common good is a choice. It cannot become an obligation. I do however believe that, in the name of shared heritage, the state should take measures to protect all citizens. As such, it could ask businesses to pollute less, for example. I do nevertheless believe that the biggest reward for a CEO is not financial, but is rather reputational. As far as I am concerned, I was very happy to receive the Legion of Honor for my plan to combat discrimination in my company. It’s a reward that I wouldn’t trade for all the money in the world.

 

Interview by Capucine Coquand

 

(Translation: Eloise Lake)

Read the full Special Report: Conscious Capitalism

What is the role of a company? Two schools of thought, two rival philosophies, have vied for supremacy for over twenty years now. Is it to put the interests of shareholders above all else, as Nobel prize-winning economist Milton Freedman declared? Or is it, in addition to the shareholders, to serve other stakeholders such as staff, clients, suppliers and beyond?
Summary Nicolas Notat (President of Vigeo-Riris): “Staff and shareholders are two constituent parts of value creation” “Nurturing well-being in the workplace and provoking the curiosity of the individual is vital to economic performance” Philippe Joannis (Founder, 5fois5): “Purpose before profit: this inversion of priorities is the key to conscious capitalism” “A reasonable level of profit is important to guarantee the continuous distribution of capital” “If a company is driven by short term profit, it’s doomed” Serge Papin (CEO, Système U): “The director must turn his company into a place of reconciliation for the different stakeholders” “It’s impossible to be profitable in the long-term while ‘massacring’ stakeholders” Stanislas Guerini (French parliamentarian): “Reimagine businesses by removing the twin barriers which oppose capital and work” Making Capitalism More Moral

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