The last week hasn’t been the best one for Orange’ boss Stéphane Richard. The first shoe dropped early last week when it came to light that Richard was detained by the police for questioning in the never-ending Tapie affair. Then came news later in the week that Richard was officially put under investigation for fraud over his role in awarding €285 million in damages to Tapie, resolving a long-standing dispute between Tapie and the now defunct Credit Lyonnais. Richard happen to be a top-aide to Christine Lagarde, the Minister of Finance and now IMF chief, when the ‘deal’ was made in 2008. Lagarde was also questioned a couple of weeks back about the affair, but was named as a material witness in the case and ultimately not put under formal investigation. Investigators had been looking into Richard’s role in the arbitration case for quite some time and had even searched his residence for evidence back in January. To his credit, Richard has remained steadfast in defense of his and other government officials’ actions stressing that they had been “trying in good faith to defend the state’s best interests.”
After being officially put under investigation last week, the chattering classes started to question whether Richard should continue as Orange CEO given recent events. Fleur Pellerin, though not giving her opinion on whether or not he should stay on, publicly raised the question last week and, smartly, took the position that it was ultimately up to the board to decide. The French government, for better or worse, still holds a 27% stake in Orange, which given the Dailymotion mess, seems to carry a lot more weight than a mere 27%.
Fortunately for Richard various constituents, including his colleagues in France’s corporate community, MEDEF and even the unions (CFDT, FO, and CFE CGC), came out strongly in support of Richard continuing in his post. In addition, wanting to avoid yet another confrontation with France’s business community and prevent putting Orange in a precarious position as it’s finally emerging from the tumultuous post-Free mobile launch period, Francois Hollande came out last night in support of Richard staying on. So, the board meeting set for today at 15h30 will just be a formality and Richard will remain at the helm of Orange..at least for now.
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