Candidate for Thales Chairmanship Pressured to Withdraw Due to Ties to Russian State-Owned Enterprises
On Tuesday, May 12, Henri Proglio abruptly withdrew his candidacy for the Chairmanship of the French defense group, Thales SA, one day before he was scheduled to the helm as a result of pressure from the French Economy Ministry. The central concern of the Ministry (and, no doubt, the French security community) was Mr. Proglio‘s perceived conflict of interest due to his rather elaborate ties to two controversial Russian state-owned companies. Specifically, Mr. Proglio is currently a board member of ABR Management, which is owned by the U.S.-sanctioned Bank Rossiya. He also sits on the boards of Akkuyu Nuclear JSC and Fennovoima Ltd. The Russian nuclear giant, Rosatom, currently owns 34% of Fennovoima and 75% of Akkuyu Nuclear JSC.
Economy Minister Emmanual Macron had asked Mr. Proglio earlier in May to cut his ties with Rosatom if he expected to become Thales Chairman. He failed to do so. Macron told reporters ‘‘‘It was normal that we asked Henri Proglio to choose between taking on a non-executive role at the head of Thales and his undertakings, actual and paid, close to major players in the Russian military and civil nuclear sector.‘ Current French President Francois Hollande, Prime Minister Manuel Valls and Defense Minister Jean-Yves Le Drian had previously supported Mr. Proglio‘s candidacy for the Chairmanship.
This move by Economy Minister Macron compelling Mr. Proglio to choose between his rather dubious Russian connections and the French defense industry is an interesting precedent for senior European executives. Thales, for example, supplied the radar and communication systems for the Mistral helicopter carriers whose delivery has been delayed due to Russian aggression in Eastern Ukraine.