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Freudenberg Group

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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 in Europe, Asia, Australia, South and North America. The parent company was founded in 1849 as a producer of leather goods.

Freudenberg SE
Company typeFamily-owned
Societas Europaea
IndustryConglomerate
Founded1849; 175 years ago (1849)
FounderCarl Johann Freudenberg
HeadquartersWeinheim, Baden-Wuerttemberg, Germany
Area served
Worldwide
Key people
Mohsen Sohi (CEO)
ProductsHousehold and other products
RevenueIncrease €11.903 billion (2023)[1]
Number of employees
52,241 (2023)[1]
Websitefreudenberg.com

History edit

Origins to 1933 edit

The company was founded in 1849 by Carl Johann Freudenberg, the son of a wine merchant,[2] and his partner, Heinrich Christian Heintze. The two took over a tannery at Weinheim where Freudenberg had been employed, and introduced lacquered patent leather as a specialty.[3] For the next 80 years, the company produced leather products exclusively.[4][5] Freudenberg prepared his sons, Friedrich Carl and Hermann Ernst Freudenberg, to succeed him, and on Heintze's death in 1874, the Freudenberg family bought his share in the business from his heirs and renamed it to Carl Freudenberg.[6][7]

 
Removal of hair from skins in the Freudenberg tannery, c. 1899

With a second tannery in Schönau and the introduction of the faster and better chrome tanning process developed in the United States, by 1914 Freudenberg had become one of the four largest leather processing firms in Germany, importing skins from the Russian Empire, Poland, Argentina, France, and the United States and exporting finished leather to markets including the British Empire, Switzerland, France, Russia, Poland, and the United States.[8] Like the rest of the German leather industry, the company was hurt by World War I, especially by the stoppage of leather imports under the Allied embargo and then by a ban that was not lifted until 1924, and also by bureaucratic controls. Under the Weimar Republic, inflation and the devaluation of the German currency hindered international business; in order to pay for imported raw materials in hard currency, the company partnered with Swiss bankers to establish Externa S.A., a credit agency in Lausanne. The company also participated in a number of cooperative agreements to facilitate exports, and skirted regulations in Poland and Eastern Europe by representing German and Austrian leather as Swiss products of its Tannerie de Lausanne subsidiary. By 1929, the company was once more exporting 70% of its production, but the worldwide economic depression that began late that year, and the high taxes that many countries imposed on imports in response, further damaged the German leather industry. Freudenberg, also affected by patent leather falling out of fashion, cut hours to avoid layoffs.[9]

Nazi era edit

In 1933 the company acquired Conrad Tack & Cie, a shoe manufacturer and seller founded in 1883. This was one of the first Aryanisations of a Jewish-owned company in the Third Reich; in the face of boycotts Hermann Krojanker, the company head, requested that Freudenberg, the company's major supplier, take it over.[10] It was Freudenberg's first expansion into both manufacturing and consumer sales; the company subsequently "Aryanised" a dozen other companies, including other shoe manufacturers and sellers which were incorporated into Tack, and other leather processors including Sigmund Hirsch GmbH, which was also in Weinheim and specialised in horse leather, and Josef Reiman / Gerhardus, an amalgamation of two Vienna companies.[11] As the Reich expanded, Freudenberg sought to acquire companies in annexed and occupied countries. They were unsuccessful in acquiring Del-Ka, a leading Viennese shoe company, or any of the shoe companies in Czechoslovakia and Poland; Nazi administrators in the east sought to avoid further increasing the market share of leading German companies, and the Czech company Bata was permitted to retain all its shoe shops since it was a valued provider of military footwear.[12] In the west, Foreign Ministry policy was to promote German industrial expansion, and Freudenberg was able to acquire Chromex, a French manufacturer of vehicle seals that had been established with financial assistance from Freudenberg in 1934 and licensed Freudenberg technology; but Freudenberg abandoned attempts to "aryanize" a leather producer in the Netherlands on grounds of likely bureaucratic veto, were passed over in the "Aryanisation" of a Luxembourg tannery, and were also rebuffed in their attempts to acquire either regional outlets or the whole company of the French shoe company André [fr], which survived the war without being "Aryanised".[13]

Freudenberg had instituted an industrial research department in the 1920s, where the Austrian engineer Walther Simmer [de] developed an improved seal for motors that was patented in 1932 as the Simmerring. In the second half of the 1930s, the company changed from leather to synthetic rubber for the Simmerring.[14] World War II led to renewed stoppages of leather imports and to other shortages; in response the company accelerated its diversification away from leather and into components for machinery.[15] From 1938, Freudenberg produced synthetic leather shoe soles under the brand name nora (the subsidiary manufacturing nora products was spun off in 2007 and is now Nora systems [de]).[6] In 1937, the company instituted testing of artificial shoe soles by a group of test walkers, initially consisting mostly of former workers. They became a noted sight in and around Weinheim, and one man walked 40,000 kilometres (25,000 mi) over the course of three years.[16] In 1940, under government oversight, German manufacturers agreed on quality and testing standards for footwear and their individual systems of use testing were replaced with a shoe test track [de] at the Sachsenhausen concentration camp. Inmates were assigned to walk a course of more than 30 kilometres (19 mi), testing sample pairs submitted by the manufacturers.[17]

Since World War II edit

The development of artificial materials for both footwear and automotive uses led to fabrics and, when it was noted that the company's cleaning women were using discarded scraps of the experimental fabrics, to cleaning materials and equipment.[4][5]Vileda (from German: wie Leder, 'like leather') window-cleaning cloths were first marketed in 1948,[18] and housewares became a major focus for Freudenberg in the first postwar decades.

 
Vileda Professional, Markham, Ontario, Canada

In the mid-1990s the company reorganized with a "highly decentralized organizational structure", into 16 divisions or areas of business incorporating 430 independent units.[5][19][20] As of 2005, three-quarters of its business was as a supplier to other companies.[21] In 2004 Freudenberg had employees in 43 countries.[4][22][23] Recently it has focused attention on markets in China and Japan; for example, it provided the floor coverings for the Shanghai Metro stations.[4]

In 2002 the company closed its last leather tannery, marking the effective end of the leather industry in Germany.[5] However, today Vileda is a market leader in Europe.[24] All German cars contain parts made by another Freudenberg subsidiary, and German-made outdoor clothing contains fibers made by yet another.[5] Almost all major airports have flooring made by another Freudenberg subsidiary.[21] In 2004, Freudenberg Group made an initial entry into the global medical market with the creation of Freudenberg Medical EN. In 2023, the group was an 11.9 billion euro business with more than 52,000 employees.[1]

Chief executives edit

  • Carl Johann Freudenberg (1849–1898) and Heinrich Christian Heintze (1849–1874)
  • Friedrich Carl Freudenberg (1898–1928) and Hermann Ernst Freudenberg (1898–1923)
  • Richard Freudenberg (1923–1962)
  • Hermann Freudenberg (1962–1988)
  • Reinhart Freudenberg (1988–1997)
  • Peter Bettermann [de] (1997–2012; first non-family member to be Speaker of the Management Board)
  • Mohsen Sohi (2012–present)[6]

Ownership and philosophy edit

 
Carl Johann Freudenberg

Freudenberg remains a family-owned private company, structured as a Kommanditgesellschaft (limited partnership) jointly held by descendants of Carl Johann Freudenberg (some 300 in 2011).[5][4] Stock cannot be sold to non-family members and must be surrendered by in-laws upon divorce.[20] No stockholder holds more than 2% ownership.[21] An annual three-day General Meeting[5] elects the Board of Partners, which consists of 7 to 13 members of whom the majority must be Freudenberg family members.[25] The divisions are managed by a Management Board, who need not be family members.[25] 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.[4] These vineyards are the largest in the Bergstraße region, producing 60,000 bottles of wine annually.[21]

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.[15][26] In 2014 he was succeeded by Martin Wentzler, also a fifth-generation family member.[27] Since July 2012, Mohsen Sohi has been Speaker of the Management Board;[28] his predecessor, Peter Bettermann, formerly head of German BP, in 1997 became the first non-family member to run the company.[5][15][4][21]

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.[5][18][29] The company would rather acquire "a handful of interesting smaller enterprises" every year than a large company that might endanger the company philosophy.[30] 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 mostly in Europe.[30]

Divisions edit

 
Headquarters of Freudenberg Sealing Technologies

As of 2024, the company consists of the following business groups (the majority headquartered in Weinheim):

  • Freudenberg Chemical Specialities, headquartered in Munich (including the subsidiaries Capol, Chem-Trend, Klüber Lubrication, OKS, and SurTec)
  • Freudenberg e-Power Systems, headquartered in Munich
  • Freudenberg Filtration Technologies
  • Freudenberg Flow Technologies, headquartered in Wolfratshausen (including TotalSealCare, Techlok, Bluelock, FlexBall, AlignLock, WellProtek, and EagleBurgmann, a partnership with the Japanese company Eagle Industries [ja][6][31])
  • Freudenberg Home and Cleaning Solutions (including Vileda, Vileda Professional, Gimi, Oates, Wettex, the American brand O-Cedar, acquired in 2003[6][32][33] the UK brand Marigold, acquired in 2013,[34] and Gala brand products under a joint venture with the Indian company Gala Brush[35])
  • Freudenberg Medical, headquartered in Beverly, Massachusetts, US
  • Freudenberg Performance Materials
  • Freudenberg Sealing Technologies (including Simmerings and Corteco, a brand of spare parts)
  • Vibracoustic
  • Japan Vilene Company, headquartered in Tokyo[36][37]

Philanthropy edit

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.[21][38][39][40]

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.[41]

References edit

  1. ^ a b c "Annual Report 2023" (PDF). Freudenberg Group. Archived (PDF) from the original on 1 April 2024. Retrieved 27 April 2024.
  2. ^ Hucke, Johannes (2009). Bergstraße-Weinlesebuch. Regio Guide (in German). Vol. 6. Karlsruhe: Info Verlag. ISBN 978-3-88190-504-6. Archived from the original on 3 April 2023. Retrieved 25 October 2022.
  3. ^ Scholtyseck, Joachim (2016). Freudenberg. Ein Familienunternehmen in Kaiserreich, Demokratie und Diktatur (in German). Munich: Beck. pp. 21–22. ISBN 978-3-406-68853-9.
  4. ^ a b c d e f g Scheele, Martin (22 January 2004). "Familie Freudenberg: Die Wischmopp-Millionäre". Manager Magazin (in German). Archived from the original on 12 August 2022. Retrieved 31 March 2022.
  5. ^ a b c d e f g h i Lamparter, Dietmar H. (24 February 2011). "Unternehmen Freudenberg: Von der Kunst des Häutens". Die Zeit. Archived from the original on 29 August 2011.
  6. ^ a b c d e Michael Horchler; Julia Schneider (January 2024). "The Development of the Freudenberg Group (Since 1849)" (PDF). Freudenberg & Co.
  7. ^ Scholtyseck, pp. 22–24.
  8. ^ Scholtyseck, p. 26.
  9. ^ Scholtyseck, pp. 35–38, 46, 49–50, 60–63.
  10. ^ Scholtyseck, pp. 113–31.
  11. ^ Scholtyseck, pp. 143–74.
  12. ^ Scholtyseck, pp. 245–51, 254–57.
  13. ^ Scholtyseck, pp. 286, 290–91, 295–301, 301–10.
  14. ^ Scholtyseck, pp. 322, 208–09.
  15. ^ a b c Sywottek, Christian (October 2008). "Das Matroschka-Prinzip". Brand Eins (interview with Wolfram Freudenberg) (in German). Archived from the original on 10 February 2013.
  16. ^ Scholtyseck, pp. 324–27.
  17. ^ Schotyseck, pp. 330–34.
  18. ^ a b Grant, Tina (2001). International Directory of Company Histories. St. James Press. ISBN 978-1-55862-446-7.
  19. ^ Company Structure Archived 27 March 2013 at the Wayback Machine, Freudenberg Group.
  20. ^ a b Block, Jörn Hendrich (2009). Long-term Orientation of Family Firms: An Investigation of R&D Investments, Downsizing Practices, and Executive Pay (thesis, Technische Universität München). Wiesbaden: Betriebswirtschaftlicher Verlag Gabler. p. 3. ISBN 978-3-8349-1959-5. Archived from the original on 9 January 2023. Retrieved 9 January 2023.
  21. ^ a b c d e f Behrens, Bolke (24 January 2005). "Freudenberg-Gruppe bewahrt beharrlich den Familiencharakter: Ein ganz unauffälliges Weltunternehmen". Handelsblatt (in German). Archived from the original on 11 June 2016. Retrieved 31 March 2022.
  22. ^ 53 in 2008, according to Sywottek.
  23. ^ As of April 2013, 58 countries: Freudenberg Group Archived 27 March 2013 at the Wayback Machine, retrieved 13 April 2013.
  24. ^ Dworschak, Manfred (1 October 2000). "'Materie am falschen Ort'". Der Spiegel (in German). ISSN 2195-1349. Archived from the original on 31 March 2022. Retrieved 31 March 2022.
  25. ^ a b "Freudenberg Group: Organization & Portfolio". www.freudenberg.com. Archived from the original on 31 March 2022. Retrieved 31 March 2022.
  26. ^ "Freudenberg: Neue Führung im Gesellschafterausschuss". Manager Magazin (in German). 27 June 2005. Archived from the original on 31 March 2022. Retrieved 31 March 2022.
  27. ^ "Change in Board of Partners' Chair" (press release). Freudenberg Group. 1 July 2014. Archived from the original on 11 August 2014.
  28. ^ "Management Changes at Freudenberg" (press release). Freudenberg Group. 29 June 2012. Archived from the original on 11 August 2014.
  29. ^ "Corporate Values: Guiding Principles". Freudenberg Group. Archived from the original on 22 September 2013.
  30. ^ a b Neukirchen, Heide; Palass, Brigitta (22 March 2002). "Familienunternehmen: Freudenberg-Gruppe". Manager Magazin (in German). Archived from the original on 13 December 2004. Retrieved 23 December 2011.
  31. ^ "History". Eagle Industry Co., Ltd. Retrieved 2 March 2024.
  32. ^ "News Briefs: Freudenberg Acquires O-Cedar Brands". HFN. 8 December 2003. Retrieved 23 February 2024 – via Free Online Library.
  33. ^ "About O-Cedar". O-Cedar.com. Archived from the original on 5 May 2013. Retrieved 13 April 2013.
  34. ^ Bamford, Vince (23 December 2013). "Marigold gloves business sold to FHCS". The Grocer. Retrieved 2 March 2024.
  35. ^ "Who We Are". Freudenberg Gala Household Products. Retrieved 2 March 2024.
  36. ^ The Freudenberg Business Groups, Freudenberg.com, retrieved 2 March 2024.
  37. ^ The company has also used the brand names Evolon, FIT (Freudenberg IT), HelixMark, Lutradur, Lutrasil, Merkel, MicronAir, Pellon, Simrit, Trelleborg-Vibracoustic, Vildona, Viledon, Vilene, and Vilmed; see "Brands" at the homepage, archived from the original on 18 December 2012.
  38. ^ Dohna, Countess Ursula (1986). Private Gardens of Germany. Harmony Books. p. 122. ISBN 978-0-517-56512-4. Archived from the original on 9 January 2023. Retrieved 25 October 2022.
  39. ^ Gardens Illustrated. 2002. p. 36. Archived from the original on 3 April 2023. Retrieved 25 October 2022.
  40. ^ Garten und Landschaft (in German). 2002. p. 44. Archived from the original on 3 April 2023. Retrieved 25 October 2022.
  41. ^ "Freudenberg foundation". Freudenberg group. Archived from the original on 7 April 2012.

Further reading edit

  • Carl Freudenberg. 150 Years of Freudenberg: How a Family Enterprise Developed from a Tannery into an Internationally Diversified Enterprise. [Mannheim]: Freudenberg, 1999. OCLC 313963779
  • Pia Gerber. Der lange Weg der sozialen Innovation—wie Stiftungen zum sozialen Wandel im Feld der Bildungs- und Sozialpolitik beitragen können: eine Fallstudie zur Innovationskraft der Freudenberg Stiftung / The Long March of Social Innovation—How Charitable Foundations can Contribute Towards Social Change in the Fields of Education and Social Policy: A Case Study on the Innovative Vigor of the Freudenberg Foundation. Opusculum 21. Berlin: Maecenata-Institut für Philanthropie und Zivilgesellschaft, November 2006. OCLC 643152814 Google preview (in German)

External links edit

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