The Interview: No fake tan to this story of success

Lindsay Owen-Jones, Chief Executive Of L'Oréal

Lindsay Owen-Jones is in his element. The long-serving British boss of France's most successful company is playing to the L'Oréal crowd, which has gathered in its headquarters in Clichy for the latest instalment of the sort of success story that must make other consumer goods companies want to weep.

Lindsay Owen-Jones is in his element. The long-serving British boss of France's most successful company is playing to the L'Oréal crowd, which has gathered in its headquarters in Clichy for the latest instalment of the sort of success story that must make other consumer goods companies want to weep.

The diminutive polyglot certainly knows how to work the floor. His tanned and furrowed face crinkles into an enormous smile each time he addresses one of the glamorous female French financial analysts - by their first name, naturellement. He is struggling not to gloat as he explains what drove the company's 20th back-to-back surge in pre-tax profit, especially considering that he has run the group for each one of those 20 years.

"I'm not bragging but I'd just like to say that it's unique. There is no other example of a company the size of L'Oréal that has achieved that," he says, unable to resist a little self-adulation.

The Ambre Solaire sun cream-to-Redken shampoo group managed profit growth before tax of 10.3 per cent last year, making just over €2bn (£1.57bn).

Mr Owen-Jones said getting there in a "sluggish year" that saw reported sales in its biggest market, Western Europe, go backwards was a bit like making a risotto. "It's down to the company's ability to take different ingredients, just like a good Italian housewife would, and produce a risotto with whatever ingredients you've been given. For each of the 20 years the recipe has been different," he says. (It's no surprise, then, to learn that Mr Owen-Jones is married to an Italian.)

He will be hoping desperately that despite soft markets the company can manage another year of double-digit growth because next February this most polished of performers - one company executive compares him to Burt Reynolds - will start to draw the curtain on a career with L'Oréal that has spanned almost four decades.

Mr Owen-Jones this week ended years of speculation by appointing his successor. He is to hand over control of L'Oréal to a Frenchman for the first time in two decades: Jean-Paul Agon, president of L'Oréal's American business, will become chief executive in April 2006, leaving Mr Owen-Jones to celebrate his 60th birthday by becoming chairman.

The move will see L'Oréal break with French convention by splitting the role of chairman and chief executive - albeit briefly, if Mr Owen-Jones has his way. "I personally am not a fan of the permanent separation of the two functions. I know it's fashionable in some countries and obligatory in others but to me, the US system that enables you to either have a chairman or a chief executive is the best because it's the most flexible," he says.

He may prefer American board structures, but he detests the American way of handling succession planning. "There is a big difference between how we organise our management succession and how US companies organise them. US companies think they're obliged to organise successions like some sort of horse race with everybody betting on several very well known players. But then, when they rip open an envelope and announce the winner, the other three end up resigning." By way of contrast, it has been an open secret for years that M. Agon was being groomed to take over. "Here, the process has been under way for years, which creates legitimacy. You get to the point when everybody knows who you're going to choose because it's obvious," Mr Owen-Jones says.

Although he has promised to be a non-executive chairman - "you can't have two people with their hands on the steering wheel" - and will therefore busy himself mainly with strategic decisions and fostering relations with investors, he believes L'Oréal's unusual shareholder base means the split with the chief executive's role is particularly unnecessary.

"There is no real issue of corporate governance in a company with such large shareholders," he says, perhaps obviously when you consider the utter adulation that Liliane Bettencourt bestows upon her company's boss. The founding Bettencourt family, France's richest, is still L'Oréal's biggest shareholder, with a 27.5 per cent stake, even after opting to give up 95 years of control last year. Its decision ended a 30-year tryst with Nestlé, the Swiss food group that still owns 26.4 per cent.

Mme Bettencourt, the 81-year-old widow who is still president of L'Oréal, is so besotted with Mr Owen-Jones that the word on the street is that he has only stayed put for so long to keep her happy. When, some years back, she learnt of his obsession with fast cars she was so worried that he might kill himself she dipped into her $20bn (£10.6bn) fortune and bought him a yacht. "Ideally, she'd make sure he stayed chief executive for the rest of her lifetime," one L'Oréal follower said.

Mr Owen-Jones may be preparing to step down but he insists he won't take his foot off the company accelerator. He declines to comment on his legacy to L'Oréal, claiming: "I'm thinking about the next four years, not looking back." He sees his eventual chairman's role as a "full-time job", which will leave him no time to daydream about life post L'Oréal. He adds: "I will have a moral obligation not to think about what I'll do in my old age."

He does lapse into a brief reminiscence about how much the group has changed during his tenure, however. The original haircare specialist is as renowned these days for its cosmetics lines such as Maybelline New York and the Japanese Shu Uemura, and its skincare brands such as Kiehl's or Vichy as it is for its L'Oréal Elvive or Garnier Fructis shampoos.

"We have had a silent revolution here, but it's been a major revolution. L'Oréal has changed in nature in the last 15 years," he says. The push, which has seen the group take on Estée Lauder in its home market as well as build an emerging markets business from scratch, has been into "high value-added products", according to Mr Owen-Jones. We're talking the likes of red hair dye for the Chinese, thickening shampoos for men with thinning hair and a bevy of potions whose labels contain more science than a GCSE chemistry paper.

With women's products still very much the company's bread and butter ("male grooming" only accounts for 5 per cent of the global beauty market), you might think L'Oréal could benefit from a more feminine-weighted boardroom. Mr Owen-Jones broadly agrees. "In the last 10 years, we have recruited more women than men. To be honest, it's been a struggle to keep them when they've been there a certain length of time...", he trails off not wanting to get into the issues of women and children. But adds: "In our labs, 70 per cent of our chemists are women so the future of the company is in their hands at that level."

It's too soon to speculate whether the L'Oréal "lifer" hopes that his only child, Celeste, will follow him into the business. She's still just 16, so the talk is more of what she'll study at university than what she'll eventually do. It's clear that Mr Owen-Jones, an Oxford Modern Languages graduate, would love her to follow in his footsteps and read French at Worcester College. His face lights up at the mention of his old French tutor, Dr Gore, who did some work for L'Oréal after retiring. "She wants to do French studies," Mr Owen-Jones says sadly. "What can I do, I'm a non-executive father?"

Intern to chief

Born: 1946, Wallasey, The Wirral. (Contrary to popular conception, Mr Owen-Jones is not, and never has been, Welsh.)

Education: Uppingham, Oxford University, Insead business school.

Career: Joined L'Oréal as an intern in 1969; chief executive of L'Oréal Italy, 1978-81; president of L'Oréal USA, 1981-84; group chief executive and deputy chairman, 1984-88; chairman and chief executive, 1988 to present. Received the Légion d'honneur on Bastille Day, 1998; awarded a CBE for contribution to Anglo-European relations, 2000.

Hobbies: Former rugby player and amateur racing driver; owns a 77ft Wally ocean-going yacht.

Family: Married with one daughter.