Molly Heaney, a fifth-generation director of JM Huber, one of the largest privately-owned businesses in the United States, says her family’s set of guiding principles remain the corporation’s “North Star” in its accelerating pace of investments.
Huber is a portfolio management company and a global leader in hydrocolloids, specialty chemicals and minerals and engineered woods, supplying industries such as agrochemicals, beverages, household products, oral care, paper, energy, plastics and construction.
With more than 4,000 employees in 20 countries and $2.4 billion in annual revenue, the New Jersey-headquartered Huber has remained family-owned since it was founded almost 140 years ago. German migrant Joseph Maria Huber opened his first manufacturing plant in New York in 1883. Entering its sixth-generation of family ownership, the daunting task of maintaining communication with the sprawling dynasty is seen by Heaney as part of her generational stewardship of the family business.
Heaney joined Huber’s corporate board in 2016 after serving as a non-voting family director on the management board of the subsidiary CP Kelco. She has also been a non-voting family director on the corporate board and the management board of Huber Engineered Woods.
Active in Huber family governance for the past 10 years, the psychology graduate has served as the co-chair of the Family Council Board (FCB) since 2012. She was also on the FCB’s Shareholder Relations Team, Education and Development Committee and Next Gen Committee.
Since 2011, Heaney has been the family communications adviser to the Huber Family Office (HFO), providing a conduit between the HFO and Huber family members. As part of her role, Heaney ensures clear communication and support for family governance programs, such as the annual meeting, Huber News and family road shows. Heaney also focuses on providing outreach and education to the Huber family, particularly for members of the fifth generation.
Huber took home the IMD-Pictet Sustainability in Family Business Award for 2020 in June 2021 out of more than 60 international family businesses from four continents.
Heaney spoke with CampdenFB about Huber’s commitment to sustainability, how to communicate effectively across many branches of the family, innovative ways to engage upcoming generations and the company’s patient capital strategy with investments.
What are Huber’s family values and how does the family apply them in business?
The Huber Family Principles serve as the foundation for the Huber Principles that guide the business conduct of JM Huber Corporation.
Huber Family Principles: To continue to foster a family and a business we are proud to share with future generations.
• Inclusive—We believe in equality and value our many differences
• Informed—We are educated and engaged
• Honest—We are truthful and trustworthy
• Generous—We commit to sharing our good fortune
• Innovative—We honour the past while building for future generations
• Patient—We have a long-term view
These principles reflect our values as owners of the JM Huber Corporation and related enterprises.
• Environmental, health and safety sustainability—We have the patience for long-term value growth, and we care deeply about the legacy we leave behind. We remain committed to reducing our footprint, pioneering new solutions for a sustainable future, and ensuring the health and safety of Huber people, our customers and the planet.
• Ethical behaviour—We operate with transparency, integrity, reliability and accountability.
• Excellence—We are not satisfied with the status quo. We constantly strive to build for future generations an enterprise that fosters continuous growth through operational excellence and generates strong financial returns.
• Respect for people—We value one another above all else. As a family, we insist that all voices are heard. Within the corporation, we will continue to build a more diverse, inclusive, equitable, and rewarding workplace. In our communities and the larger society, we will dedicate ourselves to causes that improve and heal the world.
• Family ownership—Our ownership is what binds our family and drives our success.
How does Huber incorporate its sustainability initiatives across such a diversified portfolio and in fields not associated with being environmentally friendly?
Whether the company is acquiring or operating its diverse businesses, management uses the Huber Principles to guide them and set expectations on issues including sustainability.
From the perspective of acquisitions, management, with support from the board, has walked away from potentially attractive opportunities because they were not consistent with those principles, including an unacceptable risk in terms of safety or environmental performance. In instances where the company acquires businesses, management and the family has a fundamental expectation that we will raise that business’ performance to that of Huber’s—to be the best possible operator in the world for that business.
Those expectations include adoption of Huber’s Sustainability Strategy expectations: world-class environmental compliance, environmental footprint reduction and new product development with sustainability characteristics.
For an overview of the company’s environmental, social and governance (ESG) priorities, see our Living by the Huber Principles report.
What advice would you give to family peers having difficulty communicating across multiple branches of the family business?
As a large family, we have decided it is important to identify as “one family” versus many family branches. This allows us to speak with a clear voice to the company as it relates to our principles and values. However, we also understand, and expect, that being one family does not mean we will always have one opinion. We work extremely hard in both our family and corporate governance to communicate to family members and ensure that we are hearing back from them. We do this through numerous family-wide communication opportunities from written communications, to in-person events, to virtual engagements. Having a variety of touchpoints that are accessible to everyone creates a shared understanding of important issues and builds trust. It also allows us to understand differing opinions and work toward mutual agreement.
How should families resolve conflicts before they happen?
I think communication is the key. If you are routinely sharing information and soliciting feedback from family members you can identify and address questions and concerns before they turn in to significant issues. And, as mentioned before, communication also cultivates trust, which is the antidote to conflict.
The company’s response to Covid-19 has been consistent with its history and the Huber family’s philosophy for the future—we look at the business with a long-term view that expects management to invest in a manner that makes it resilient and robust to address adversity, whether it be short-term or longer lasting.
A pre-eminent family concern for the Huber family was the health and wellbeing of our employees. We entrusted management to be proactive in addressing our employees’ safety and they accomplished this very effectively through best-in-class pandemic safety protocols adjudicated under the cross-functional Huber Incident Response Team and led by senior management with weekly, and daily, engagement.
Beyond this, the family also wanted to signal to our employees that we cared about their wellbeing including potential financial uncertainties. No one knew what was going to happen and there was a significant portion of the business world that used employee reductions in force as a way to mitigate headwinds. We made the decision to weather the storm and hold on to our talent and become even stronger. We tangibly expressed this through an all-employee financial bonus related to their perseverance in the face of Covid-19 that contributed in a significant manner to our overall business success through this period.
How has the pandemic influenced the Huber family’s attitudes to investments and risk management?
The family’s focus on quantitative assessment of investment opportunities and risk management is unwavering and has simply been reinforced during Covid-19. The company has actually accelerated its pace of investment over the last year, including record capital projects during the peak of the pandemic to build long-term capacity.
Management’s approach to investments remains focused on attaining strategic objectives while balancing the risk profile in a turbulent market. The family’s long-term “patient capital” approach comes into play, as some investments may take years to pay dividends.
We want management to take a holistic view of capital deployment, preparing to make good decisions and wait for the right opportunity and look for the right investment in terms of the Huber Principles. For example, our timber management business recently acquired a company we have worked closely with for nearly 80 years. Not only was it a logical investment to grow the business, but we knew that culturally it would be a good fit. The value of a strong set of guiding principles continues to be the “North Star” to guide these decisions.
Is Huber involved in impact investing or have plans to impact invest?
Yes, as part of the Huber Helps community engagement program, the company has pledged to donate 1% of its net income annually to organisations that are doing good in the world. Huber maintains a partnership with Habitat for Humanity International, which includes a $500,000 annual cash donation as well as a donation of $250,000 worth of Huber Engineered Woods building products every two years.
The company is also a sponsor of the Gary Sinise Foundation’s RISE programme, which builds specially adapted smart homes for America’s most severely wounded veterans and their families. Through the Huber Helps Impact Your Community programme, the company has provided funding for STEM education in several communities where we have operations.
Huber’s HR team has stepped up recruiting efforts and internship opportunities with historically black colleges and universities, known in the United States as HBCUs. The company is actively looking for other partners to magnify the scale of our investment through reputable non-governmental organisation. Huber is also exploring potentially less conventional investment opportunities in the areas of carbon sequestration and investments in minority owned businesses.
Huber has always been a meaningful part of my life, and my mother was a tremendous model of commitment and leadership in our family governance work. Early in my career, I was very focused on creating a professional identity that was distinct from Huber. It was important to me to follow my interests and build skills and experience outside of our family business. My mom did finally encourage me to join a family governance task force in 2007, and I was immediately captivated. That task force showed me the unique opportunity I had to be connected to family and the business, and I understood the real responsibility I feel to be a good steward of Huber for future generations. I have been working in family and corporate governance ever since.
How does Huber use internships and employment opportunities to on-board its next-gens into the family business?
We use both an internship programme and a non-voting director programme to give family members opportunities to learn about Huber and develop skills that could be used as a future employee or a director.
Our non-voting director programme allows family members to spend two years (eight meetings) serving on our corporate board or one of our portfolio business boards. Non-voting directors are expected to prepare for and participate in meetings just as if they were a voting director. They are assigned a mentor and receive feedback and coaching before and after each meeting. I had the privilege of serving as a non-voting director on our corporate board and two of our business unit boards before I became a voting director.
Family members are invited to intern for the company during the summer months. Interested family members work with our family’s Education and Development Committee and a HR representative from Huber to identity areas of interest for the family member. Currently, our two family employees began their Huber careers through a summer internship.
Huber is investing in both organic and inorganic growth opportunities. The company has a robust balance sheet and is well-positioned financially to capitalise on these opportunities, guided by a growth philosophy and expectation grounded in the Huber Principles.
Record performance over the past several years is indicative of this approach and enables Huber to fund future profitable growth opportunities now and for years to come.