Total defends profits after outcry by unions

Following is a letter sent to the Editor of the Financial Times:

Sir/Madam,

Thierry Demarest, Executive Chairman of Total the French oil and gas company is upset that he is being criticized in France for having announced record profits, which of course is what all oil and gas companies have been doing recently (“Total defends profits after outcry by unions” FT February 16).

Mr. Demarest’s retort is that in order for there to be strong and independent national companies, by which he means French companies, they need to be profitable and sizeable.

He is wrong of course. In order to remain a French national champion, Mr. Demarest needs to keep what Thierry Breton, the French Economy Minister, calls his stakeholders happy, of which shareholders are last on the list, by a long way. That means his employees and the unions, so employment and wages have to be high, and the government, so taxes have to be high.

Of course profits will suffer, but keep these two stakeholders happy and Total should have nothing to worry about when a foreign oil and gas company comes calling. Keep profits high at the expense of the unions and the government and he won’t last long in the job.

Onésimo Alvarez-Moro

See full Financial Times article (paid registration required).