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In the last few
decades, many seed companies have become part of large
conglomerates for whom plant breeding and seed production are
but one of many activities. While a number of companies have remained in the
private hands, very few have gone from family ownership to
corporate ownership and back again.
Rijk Zwaan
is such an exceptional company. after being family-owned for two
generations,
it became part of BP Nutrition and, subsequently, of the
Cebeco co-operative, then returned to its roots and became a family-owned
company once again.
A family-owned
company is supposed to have many weaknesses compared to its
competitors. Many believe that the shareholders lack financial
ambition, hold on to the initial activities for too long, are
not daring enough and pamper the employees overmuch, to name a
few criticisms. The philosophy regarding leadership, strategy,
finances, social security and management do not come up to the
mark, is the general assumption.
According to
FBNED, the association of family-owned companies, the opposite
it true. Their research confirms that these companies are
long-lasting, excel in their own niches, survive in bad times,
have loyal and highly motivated employees and are far more
consistent in their acts. The history of Rijk Zwaan, seems to
confirm this viewpoint.
People as focal point
For three years, Rijk Zwaan was owned by a multinational, and for another
thirteen years the majority of the shares were in the hands of a
large co-operative. The main reason to again become a
family-owned business was the ambition which the present owners
share. The ultimate goal of most companies is to earn the
optimal return on investment. Rijk Zwaan is an exception to that
rule. The primary principle of the present owners, Anton van
Doornmalen, Maarten Zwaan and Ben Tax, is to ensure that the
employees have satisfactory, rewarding jobs.
“Our focal point
is people”, says Ben Tax, one of the three board members of Rijk
Zwaan. “And we succeed in creating the right circumstances for
them. In a recent job satisfaction poll among several thousand
Dutch and German companies, Rijk Zwaan ended in the top 3.” At
the same time the company is commercially successful. “We have
about 1,100 employees worldwide and subsidiaries in more than
twenty countries, and we are market leader in several segments.
We are among the top ten vegetable seed companies”, he adds.
History
 The early
history of Rijk Zwaan resembles that of many seed companies. In
1924 the founder (photo), who gave his name to the company, started a
shop for vegetable seed in Rotterdam, the Netherlands. Soon
after, he started his own breeding activities. The company
blossomed and became one of the leading seed companies in the
Netherlands. In due course, the founder retired and his son Jaap
took over. In the next decades the company expanded and founded
subsidiaries in other countries.
For Rijk Zwaan
as for many of its competitors, the 1980s were times of enormous
changes. The seed companies recognised the opportunities which
biotechnology had to offer, but realised that the investments
would be exorbitant. At the same time the outside world, and
especially the large oil, chemical and pharmaceutical companies,
became interested in seeds. In their view, diversification was
vital to their own businesses in order to spread risks. In a
nutshell, their reasoning was: "The population will always
increase and people have to eat". Moreover, both parties would
profit from uniting activities, as they share in-depth knowledge
of molecular biology.
In addition Jaap
Zwaan had another matter to consider. He was in his late fifties
and none of his children considered a career in the seed
industry. When British Petroleum approached him in 1986, he was
willing to sell the shares in order to ensure the survival of
the company. Anton van Doornmalen and Ben Tax, who were
appointed directors not long before, were not too happy with the
decision. “We did not want BP to interfere with the daily
affairs. Luckily the oil company agreed to keep its distance and
to evaluate our results afterwards.”
Firm conditions
Only three years
later, BP completely changed its strategy and decided to focus
again on its core business. A private auction was held, but the
employee council did everything it could to prevent the sale of
the shares to an outsider. Even another seed company would not
find favour in their eyes. The newly appointed director Maarten
Zwaan, a nephew of Jaap Zwaan, as well as Anton van Doornmalen
and Ben Tax also had some demands of their own. “We insisted
that the job security should be guaranteed, that the company
would be left intact and that the new owner would not try to
change the corporate culture. The latter was especially
important to us, as we believe people should be the focal point
for a company.”
Ben Tax thinks
it was especially brave of Maarten Zwaan that he took this
stand. “Anton and I were young enough to easily find another job
in case BP did not agree to our conditions, while Maarten was
already in his fifties.” But again BP acceeded to their wishes
and agreed to a management buyout.
“However,
Cebeco, one of the original bidders, remained interested in the
company and we later sold 70% of the shares to them.” This was
done to finance the management buyout. At the time of the sale
of the shares to Cebeco, an agreement was reached with regard to
the corporate governance of the company and the eventual sale of
shares in the future. Later, when Cebeco underwent a
reorganisation, it sought to acquire the remaining 30% because
being able to sell the whole company would certainly mean more
profit than selling only a portion of it. However, the other
three shareholders firmly rejected the proposal. Instead, they
themselves bought the shares of Cebeco in 2002.
Values
“We are simply
not interested in cashing in, as we do not strive for personal
gain. I know that most people will consider this an irrational
decision, but what counts for us is that we have the best
quality of life working here and doing exactly what we love to
do.”
Since that time,
the threesome has kept Rijk Zwaan a family-owned company.
The corporate
culture runs deep throughout the company: whether at one of the
European subsidiaries or among South American or Chinese
employees, the same values are held everywhere. “And all of our
employees can participate in the share option plan. Only our
employees are entitled to buy shares. Right now, they own 14% of
the company.”
To ensure that
knowledge is not lost, Maarten Zwaan has a seat on the board of
advisors. His daily work has been taken over by Kees Reinink.
Besides Maarten, the board consists of Pieter-Klaas Jagersma,
professor in international strategy at the Free University
Amsterdam and at Nyenrode University in Breukelen, and
Jean-Pierre van Leeuwen, a solicitor who became involved in Rijk
Zwaan when the shares were bought from Cebeco.
Ben Tax is not
sure what will happen in the long run. Appointing the right
successor is always difficult for family-owned companies. “Of
course I would like one of my children to succeed meat some
point, but if and only if he or she is really capable of making
a success of it. At the moment, one of Anton's daughters works
in the company and she is doing a great job in the logistics
department. But only time will tell whether our children will
take up the reins in due course. We do not have to worry about
it just yet. Until the time comes, we are just enjoying our
daily work.” |
