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The collapse of Asian financial markets in 1997, triggering fears of a worldwide economic recession, came as no surprise to Jean Fayet. In fact, he was surprised it hadn't happened a lot sooner. Korean companies' borrowing, on average at seven per cent of their total costs, was over three times the figure for Western manufacturers. This was never sustainable, he says. Some companies were not even disclosing their level of debt and Korean chaebol (conglomerates) lacked strategic goals, he adds. Several went to the wall following bank closures, including Daewoo, and South Korea had to be bailed out by the IMF.

As head of Siemens Automotive in France, Fayet was in South Korea at the beginning of the crisis. The company had four joint ventures in South Korea and, as one of the world's leading suppliers of automotive parts, had close ties with Korean car companies, including Daewoo and Hyundai. Siemen's financial directors were absolutely shaking, asking 'How much have we lost?' says Fayet. In the event, it was not a large sum for the German multinational. Fayet himself is confident that Korean chaebol have learnt their lesson, though at a price, including major sell-offs of core businesses and restructuring. Korea is now in a stronger position, he says, thanks to its 'deep fixed roots of educational know-how and skills'.

Far more worrying are the consequences of globalization, he believes. Jobs are moving to the low wage economies of China and Eastern Europe, leading to exclusion--the word often used in France for poverty--amongst western workers. In his own industry, for instance, France no longer manufactures any of the 30 kilometres of electrical wiring which goes into each car: the entire process has moved to the Czech Republic and Lithuania.

Fayet asserts that globalization is desirable for world justice. But he fears that there will be 'some kind of revolution' between the excluded and those remaining in jobs. There were signs of this in France when there was a record three million unemployed--over 12 per cent--and 11 per cent living below the poverty line, though by the end of 2000, unemployment had fallen back to just over two million or 9.2 per cent. As in Germany, the jobless had been on street demonstrations.

'The world is becoming a village, but at what price?' Fayet asks. Surprisingly for a senior industrialist, he believes that market forces alone are not going to solve the problem. Governments may have to 'interfere', if only to control the pace of events. America, for instance, has a 'buy American' policy which advertizes the American content of products. 'Without deviating from international law, they set up new rules of the game,' Fayet comments. But he was concerned that, prior to the crisis, there was little intergovernmental debate on the issue.

Fayet knows at first hand the cost of not remaining globally competitive. In the early 1980s, he had the 'painful' experience of downsizing Peugeot Talbot's car manufacturing in Britain when he was Director of Industrial Operations. As the value of sterling rose, the cars became too expensive for the export market. He spent three years closing eight out of nine plants, reducing the workforce from 24,000 to 6,000. Linwood in Scotland became 'a ghost town', he says. 'You are aware of the misery you are creating.'

But he was also determined to keep a British base for Peugeot. In what he calls the biggest risk of his business career, he transferred the manufacture of a new model, the Horizon, from France to Peugeot's Ryton plant in Coventry, without obtaining the agreement of the French parent company. Ryton had a highly skilled workforce, and he believed that Peugeot would lose its British market share without a UK manufacturing base. The parent board in Paris gave their grudging approval only three months before the car's launch. The Horizon may not have been a world beater. But today Peugeot retains nearly eight per cent of the UK market, and Ryton manufactures the highly-acclaimed 206 hatchback.

Throughout his career, Fayet has not hesitated to take such risks for what he believes to be right--and paid the price. Returning to France in 1982, he was given a sinecure appointment at Peugeot. 'After six months I went mad.' He went to the top management and handed in his resignation. 'They did not want to keep me.'

He joined the US car components company CIM Rockwell as General Manager in France, but clashed with his American boss when she wanted to close its most productive French plant. He resigned over the issue, feeling sick at heart and, at 50, a failure, until a Catholic priest helped him to gain perspective. He joined Bendix Electronics as President of its French operations, and when Bendix France was taken over by Siemens in 1986 he was appointed Senior Vice-President and General Manager of Siemens Automotive. It is the world's fifth largest electrical and electronic engineering company, supplying the world's major car manufacturers.

Jean Fayet comes from a village of 2,000 people in central France where his father was the local pharmacist. Jean was only five when his father died of cancer. By the end of World War II he was nine years old, with the memory of his father kept alive by his mother. 'In my countryside and mountain childhood, I benefited from one amazing thing: a faith as natural as the passing seasons. I remember my grandmother with her expansive kindness, which meant there were always a few strange vagabonds in her home. They shared our meals and found board and lodging in one house or another. I experienced this with all the simplicity, challenge and reverence to God which have affected and formed my attitudes ever since.'

He studied engineering and had his first taste of the ruthlessness of big business after joining the Simca car company in Poissy in 1973. The management wanted to fire 150 workers who were suspected of being communist agitators. They urged Fayet, then a 37-year-old plant manager, to provoke a row by placing tools and spare parts in workers' bags, so that they would be caught as thieves at the factory gate. Fayet refused.

Instead, he persuaded a local Catholic priest to call a press conference to protest against the workers' dismissal. The issue became a cause celebre in the national press and Fayet was summoned by the board to ask if he was behind the press campaign. He admits that he denied it. But the campaign worked and, he says, such underhand management methods never recurred. 'That was my first real confrontation with large-scale compromise. I came through it thanks to the way I had been brought up and through the support I received from my friends in the Employers' Christian Movement.'

Fayet's career seems to have been marked by stands such as this. What gives him the courage? 'I cannot tolerate injustice,' he replies unhesitatingly. 'It is impossible for me to work against what I feel is my conscience.' He is cautious about attributing this solely to his religious upbringing, knowing that his brother, a non-believer, also has a strong social conscience, 'and we have the same outlook'. But Fayet believes that 'God is behind us, whether we are willing him to be so or not, whether we name him or not.' And he regards his own strong family life, 'shaped by evening prayers', as 'the foundation of my professional career'.

Following an invitation to speak to a Christian trade union group in Coventry, Fayet came to know about the Caux Conferences for Business and Industry, held annually at the MRA centre in Switzerland. Fayet says he enjoys addressing such conferences because, 'the benefit in teaching is first to the teacher. It is a tremendous opportunity to formulate one's thinking.' Speaking at Caux in 1997 he urged that businesses should not be afraid of 'a certain kind of chaos'. They expanded best through encouraging small projects, whereby individual managers take initiative.

'My contribution at Siemens has been to develop an entrepreneurial spirit by decentralization,' he says, adding that it has taken him seven years to persuade his managers of the importance of this. 'We need to give people hope and place power in their hands. Now our employees have a feeling of being entrepreneurs.' Engineers at Siemens Automotive, for instance, are developing a revolutionary new fuel injection system.

But his strongest message is that big companies need to take risks to stay competitive. The French education system, he says, with its emphasis on egalitarianism and fraternity, does not always encourage this. But in a global economy, job creation--indeed civilisation--may depend on developing 'a culture of risk taking'. And at the personal level, he says, 'Creativity is linked with precariousness but security in life goes against surpassing oneself.'

When Fayet retired in September 1998, he looked forward to returning to his farm in his home village and spending more time with his family, including his 12 grandchildren. He jokes that with power there is always the danger of becoming a megalomaniac, and he wonders if he is 'able to live without the strong recognition and consideration' which came with his high position. That may be another risk he'll have to take. But one cannot help feeling that an entrepreneur who has staked his career on taking risks will continue to make his presence felt on the world stage.

Updated from an article first published in For A Change magazine, April/May 1998.