Freudenberg Group

Freudenberg SE
Website www.freudenberg.com

The Freudenberg Group is a German family-owned diversified group of companies whose products include housewares and cleaning products, automobile parts, textiles, building materials, and telecommunications. Its headquarters are in Weinheim, Baden-Württemberg, and it has production facilities and markets in Europe, Asia, Africa, Australia, and the United States. The parent company was founded in 1849 as a producer of leather goods.

History

The company was founded in 1849 by Carl Johann Freudenberg, the son of a wine merchant,[2] and his partner, Heinrich Christoph Heintze; the two took over a tannery at Weinheim. For the next 80 years, the company produced leather products exclusively.[3][4] Hurt by the worldwide economic depression that began in 1929, and by shortages during World War II, it diversified into seals for motors made first of leather and later of artificial rubber (the Simmerring, named for an engineer called Walther Simmer),[5] which led to fabrics and to cleaning fabrics and tools when it was noted that the company's cleaning ladies were using discarded scraps of the experimental fabrics.[3][4] Vileda (from German: wie Leder, "like leather") window-cleaning cloths were first marketed in 1948.[6]

In the mid-1990s the company reorganized with a "highly decentralized organizational structure": it has 16 divisions or areas of business incorporating 430 independent units.[4][7][8] Three-quarters of its business is as a supplier to other companies.[9] In 2004 Freudenberg had employees in 43 countries.[3][10][11] Recently it has focused attention on markets in China and Japan; for example, it provided the floor coverings for the Shanghai Metro stations.[12]

In 2002 the company closed its last leather tannery, marking the effective end of the leather industry in Germany.[4] However, today Vileda is a market leader in Europe.[13] All German cars contain parts made by another Freudenberg subsidiary, and German-made outdoor clothing contains fibers made by yet another.[4] Almost all major airports have flooring made by another Freudenberg subsidiary.[14] In 2014 the group was a 7 billion euro business with more than 40,000 employees, approximately 11,000 in Germany. Revenues rose from 6.6 billion euros in 2013 to 7.039 billion in 2014.[4]

Ownership and philosophy

Freudenberg remains a family-owned concern, structured as a Kommanditgesellschaft (limited partnership) jointly held by descendants of the founder (some 300 in 2011).[4][15][16] Stock cannot be sold to non-family members and must be surrendered by in-laws upon divorce.[17] No stockholder holds more than 2% ownership.[18] An annual three-day General Meeting[4] elects the Board of Partners, which consists of 7 to 13 members of whom the majority must be Freudenberg family members.[19][20] The divisions are managed by a Management Board, who need not be family members.[21] Stockholders receive a semi-annual family newsletter and have access to an owners' intranet. A select few are on the Wine Commission, which oversees the private Freudenberg vineyards.[12] These vineyards are the largest in the Bergstraße region, producing 60,000 bottles of wine annually.[9]

Wolfram Freudenberg, a fifth-generation family member who formerly headed the Stuttgart Stock Exchange, was Chairman of the Board of Partners from 2005 to 2014, succeeding Reinhart Freudenberg, who stepped down for reasons of age.[5][22] In 2014 he was succeeded by Martin Wentzler, also a fifth-generation family member.[23] The spokesperson of the Management Board is Mohsen Sohi;[24] his predecessor, Peter Bettermann, formerly head of German BP, in 1997 became the first non-family member to run the company.[4][5][12][15][18]

In the late 1930s, the company developed operating principles that include broad diversification in both products and markets, spreading of risk, long-term thinking and the maintenance of an equity ratio of at least 40%, and avoidance of large acquisitions while favoring small ones.[4][6][25] The company would rather acquire "a handful of interesting smaller enterprises" every year than a large company that might endanger the company philosophy.[26] In each area of activity, the company operates only where it can be first or second in the market; for example, it sells motor seals worldwide but Vileda mops only in Europe.[26]

Brands

Brands listed on the company's website[27] are:

Freudenberg Household Products Division also sells products under the O-Cedar brand name in the US.[28]

Philanthropy

The Freudenberg Group owns the Schau- und Sichtungsgarten Hermannshof, a public botanical garden in Weinheim, which opened in 1983 and is jointly operated with the town.[9][29][30][31]

The Freudenberg Stiftung was founded in 1984 and is endowed with stock in the parent company. It has a broad mandate "to promote science, the humanities and education as well as strengthening peaceful coexistence in society and culture" and focuses particularly on assistance to and democratic education of young people, primarily in Germany.[32]

References

  1. ↑ Facts and Figures, Freudenberg.com, retrieved 18 June 2014.
  2. ↑ Johannes Hucke, "Weingut Carl Freudenberg, Weinheim," in Bergstraße Weinlesebuch: die Winzer der Badischen und der Hessischen Bergstrasse von Süd nach Nord; mit kulinarischen, anekdotischen und sogar landeskundlichen Hinweisen, Regio Guide 6, Karlsruhe: Info, 2009, ISBN 978-3-88190-504-6, pp. 191–95, p. 195 (German)
  3. 1 2 3 Martin Scheele, "Familie Freudenberg: Die Wischmopp-Millionäre," Manager Magazin 22 January 2004 (German)
  4. 1 2 3 4 5 6 7 8 9 10 Dietmar H. Lamparter, "Von der Kunst des Häutens: Freudenberg – oder wie aus einer kleinen Gerberei ein breit aufgestellter Industriekonzern wurde," Die Zeit 27 February 2011 (German)
  5. 1 2 3 Christian Sywottek, "Das Matroschka-Prinzip,", interview with Wolfram Freudenberg, Brand Eins October 2008 (German)
  6. 1 2 Tina Grant, International Directory of Company Histories, Gale Virtual Reference Library, volume 41 Detroit: St. James, 2001, ISBN 978-1-55862-682-9, p. 171.
  7. ↑ As of April 2013, under Business Groups the company lists the following four Business Areas, each of which incorporates several Business Groups: Seals and vibration control technology; nonwovens and filtration; household products; specialties and others. See also Company Structure, Freudenberg Group.
  8. ↑ In 2008, 434 subsidiary companies: Sywottek, cited in Jörn Hendrich Block, Long-Term Orientation of Family Firms: An Investigation of R & D investments, Downsizing Practices, and Executive Pay, Thesis, Technical University of Munich, Wiesbaden: Gabler, 2009, p. 102, note 188.
  9. 1 2 3 Bolke Behrens, "Freudenberg-Gruppe bewahrt beharrlich den Familiencharakter: Ein ganz unauffälliges Weltunternehmen," Handelsblatt January 24, 2005, p. 3 (German)
  10. ↑ 53 in 2008, according to Sywottek.
  11. ↑ As of April 2013, 58 countries: Freudenberg Group, retrieved 13 April 2013.
  12. 1 2 3 Scheele, p. 3.
  13. ↑ Manfred von Dworschak, "Hygiene: Materie am falschen Ort,", Der Spiegel 2 October 2000 (German)
  14. ↑ Behrens, p. 1.
  15. 1 2 Scheele, p. 2.
  16. ↑ Block, p. 3.
  17. ↑ Block, p. 4.
  18. 1 2 Behrens, p. 2.
  19. ↑ Company Structure, Freudenberg Group.
  20. ↑ Company Structure: Freudenberg & Co. > Board of Partners, Freudenberg Group.
  21. ↑ Company Structure: Freudenberg & Co. > Management Board, Freudenberg Group.
  22. ↑ "Freudenberg: Neue Führung im Gesellschafterausschuss", Manager Magazin June 27, 2005 (German)
  23. ↑ "Change in Board of Partners' Chair", Press Release, Freudenberg Group, 1 July 2014.
  24. ↑ "Management Changes at Freudenberg", Press Release, Freudenberg Group, 29 June 2012.
  25. ↑ Corporate Values: Guiding Principles, Freudenberg Group.
  26. 1 2 Heide Neukirchen and Brigitta Palass, "Familienunternehmen: Freudenberg-Gruppe," Manager Magazin 22 March 2002 (German)
  27. ↑ The Freudenberg Brands, Freudenberg Group, retrieved 13 April 2013.
  28. ↑ About O-Cedar, O-Cedar.com, retrieved 13 April 2013.
  29. ↑ Countess Ursula Dohna, Princess Marianne Sayn-Wittgenstein-Sayn, and Count Philipp Schönborn, Private Gardens of Germany, New York: Harmony, 1986, ISBN 978-0-517-56512-4, p. 122.
  30. ↑ Gardens Illustrated 2002, n.p..
  31. ↑ "Nachrichten," Garten und Landschaft 112 (2002) p. 44 (German)
  32. ↑ Freudenberg foundation, Freudenberg group.

Sources

External links

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