Liberte, Egalite, Affirmative Action

Yazid Sabeg remembers the moment when he decided to stand up to racism in France. The day after the September 11, 2001, terrorist attacks in the U.S., Sabeg's 14-year-old son was set upon by classmates at his elite Paris school. French-born Karim had to endure jeers and taunts of "Go back to your country, Arab." Recalls Sabeg: "It was clear to me that my country, France, couldn't admit that it was a multicultural land."

Sabeg, chairman of $520 million high-tech group CS Communication & Systèmes, based near Paris, has since become a standard-bearer for a business-led movement that aims to end some of the glaring inequalities in the land of liberté, égalité, fraternité. Early last year, Institut Montaigne, a Paris think tank, published a call by Sabeg for the introduction of U.S.-style affirmative action policies to end discrimination against what he calls "visible minorities" -- French nationals of North African or African origins.

The move touched a chord in a country that has been quick to criticize intolerance abroad while often ignoring it at home. Then-Finance Minister Nicolas Sarkozy threw his support behind Sabeg's proposal. At the same time, Claude Bébéar, chairman of insurance and financial services giant Axa (AXA), was commissioned by the government to look into ways to end workplace discrimination. Last October, after prodding from Bébéar and Sabeg, the heads of 40 large French companies, including Airbus, energy group Total (TOT), PSA Peugeot Citroën (PEUGY), and steel giant Arcelor signed a "Business Diversity Charter." The charter does not set hiring quotas, but companies must publish an annual account of the steps they've taken to promote diversity.


Although Arab and African minorities represent more than 10% of the population, they're all but absent from France's elite. There is not a single Arab representative in the Parliament. Meanwhile, a study commissioned by Zurich temp giant Adecco (ADO) showed that white French job applicants get three times as many offers as minority applicants with the same qualifications.

Sabeg, 54, stands out as an exception to the rule that career paths are blocked for French citizens of Arab origins. Born in Algeria, he grew up in the northern city of Lille, where his father worked as a stevedore. Equipped with a PhD in energy economics from the Sorbonne, Sabeg in 1981 set up his own energy consulting company, Enerfinance, with clients in the Persian Gulf. A decade later he engineered a $60 million takeover of a French engineering group Compagnie des Signaux, later renamed CS Communication & Systèmes. CS supplies sophisticated systems such as those used for air-traffic control and toll collection. That's not to say Sabeg hasn't experienced discrimination. Although CS has key contracts with the French Defense Ministry, Sabeg was unable to get government security clearance for two years because of his background.

Although many French companies are starting to embrace the concept of diversity in the workplace, there is a split about whether this should be mandated by new laws. Sabeg favors a more forceful approach, such as denying companies access to the often ethnically revealing names of job applicants in initial recruitment stages. Others point out that affirmative action would conflict with French laws that forbid classifying citizens by race or religion. "Hiring practices have to open up, but right now it can only be done on a voluntary basis," says Boston Consulting Group's Laurent Blivet, who has authored a study on workplace discrimination in France.

Sabeg, Blivet, and others agree on one point: If no action is taken, France runs the risk of a social explosion. Unemployment and poverty are rife in the grim suburbs that are home to many French of North African origin. "I'm worried that we are heading for a situation like that of America in the 1960s, when frustration and anger led to violence," says Sabeg. The fact that he and others in the business community are waking up to the problem may help avert such a crisis.

By John Rossant in Paris

The Good Business Issue
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