Our Differences are Many, Our Potential Is Great

This is a recent speech Carlos Ghosn delivered in New York at the Arab Bankers Association of North America award dinner, in acceptance of the ABANA 2014 Achievement Award. It appears in the December issue of Vital Speeches of the Day.

You can view it on LinkedIn here.

Your Excellencies, members of the ABANA Board, ladies and gentlemen: I feel privileged tonight to accept this award on behalf of the Renault-Nissan Alliance.

David (Rubenstein), you described me as “an inspirational advocate of cross-cultural understanding and diversity within the business world.” I’m thankful for the “inspirational” part, but I must admit that despite our efforts, there remains plenty of cross-cultural misunderstanding in today’s business world. I’m sure most everyone in this room will agree.

But you’re right: I have been and will continue to be an advocate for cross-cultural understanding and working, as well as for promoting diversity. And this is what I want to talk to you about briefly tonight.

Diversity: the Alliance story

I’m convinced the success of the Alliance between Renault and Nissan has been due largely to our ability to unlock the potential in our cultural diversity, to learn from and grow from what makes us different.

The Alliance began 15 years ago, in 1999. Few experts in the automotive industry gave it any chance of success.

Think about it for a moment: Here was a Japanese company, Nissan, on the verge of bankruptcy, a company with a distinctly Japanese culture and way of doing business. And here I was, a Lebanese-origin, Brazilian-born French executive, working for a regional French automaker, Renault, with a track record of failed partnerships.

Why would they think we had a shot?

My friend, Bob Lutz, who was with GM at the time, said Renault would have been better off taking its $5 billion cash investment in Nissan, placing it on a barge, and dumping it in the Pacific. He said that we would have saved money!

The CEO of a major German competitor said, “Two mules do not make a race horse.”

"Here was a Japanese company, Nissan, on the verge of bankruptcy, a company with a distinctly Japanese culture and way of doing business. And here I was, a Lebanese-origin, Brazilian-born French executive, working for a regional French automaker, Renault, with a track record of failed partnerships. Why would they think we had a shot?"

Well, fortunately, we didn’t pay too much attention to the critics. Today the Renault-Nissan Alliance is the longest-lasting, cross-cultural combination among major automakers … or among any industrial companies.

I’ll get back to the Alliance in a moment.

There’s another alliance I want to mention, one that exists to promote cross-cultural understanding: this organization. One of the fundamental reasons ABANA exists is to serve as a bridge between the financial sectors in North America and the Middle East-North Africa region.

It’s a needed role that this organization has served with honor for 30 years.

The Arab world

The same sort of bridging between different cultures is needed today on a much larger scale – across the Arab world.

When you look across the region, it’s clear the Arab world is living far below its potential. And it is a deeply shared frustration, because so much potential is there. The region has a young population, it’s rich in resources, it’s rich in land. Throughout the region, there is a long, proud history and culture of innovation and entrepreneurship.

The Arab world possesses most of the qualities needed for a broader economic prosperity. Yet despite all of its potential, much of the Middle East and North Africa suffer from chronically high levels of unemployment, which often leads to despair and eventually to extremism.

I am often asked, as a global business leader from the region, to assess the potential for new manufacturing in the region. My answer is simple: We must destroy the existing walls and obstacles to trade; for this, we must reduce fear.

Economic development is handicapped in places where people are afraid. And much of the Arab world today is rife with conflict, division and fear.

Obviously, we cannot erase what makes us different. Our culture, our religion, our upbringing –these are part of who each of us is as individuals. But we have to find a concrete way for people to see these differences as a source of potential wealth and enrichment. We have to find ways to make our differences strengths rather than a source of suspicion and fear.

Growing up in Lebanon

I was very fortunate to have grown up and been exposed to different cultures in my formative years. I was born in Brazil, spent much of my childhood in Lebanon, and I received my higher education in France. It truly was a mind-opening experience.

My school years in Lebanon were particularly important. As most of you know, Lebanon is a vibrant nation long known for its cultural and ethnic diversity. And compared with the region as a whole, it has enjoyed both religious diversity and tolerance for a long time.

I came of age immersed in a community of different languages, different beliefs and different cultures. This was long before the term “globalization” became part of our lexicon.

"If we can make even a little progress in transforming the way we deal with our differences in the Arab world, we will see the region’s economies blossom."

And, of course, I didn’t realize it at the time, but it was a tremendous foundation for my life in the global business world that would develop in the years ahead. I learned early how to deal with people from different walks of life, to see things through another’s eyes, which are critical skills in business today.

If we can make even a little progress in transforming the way we deal with our differences in the Arab world, we will see the region’s economies blossom.

Now, I am a realist. I don’t profess to have specific solutions to the many conflicts and divisions that are hindering the region today. But all of us can promote the idea that our differences can serve as our strength, that we need to adopt new ways of looking at one another, and to imagine new, pragmatic possibilities.

That is, in fact, the only way a business – or society – can develop. In a sense, leadership is about imagining new, concrete possibilities.

Alliance lessons learned

Which brings me back to the Alliance and the lessons we’ve learned growing one of the world’s most diverse corporate partnerships.

When we began, we knew we were charting new territory. Our two companies were very different. Renault was primarily a western European company. Nissan was primarily a Japanese and North American company and, as I said earlier, it was nearly bankrupt.

"There was, in fact, no template or precedent for this kind of arrangement. It wasn’t a merger, it wasn’t designed to force two different cultures together and create a new one."

Rather, we were intent on retaining each company’s distinct culture and brand identity, while taking advantage of the many potential synergies. It was a unique but very pragmatic approach. And we didn’t spend too much time estimating the odds of success or failure.

There was, in fact, no template or precedent for this kind of arrangement. It wasn’t a merger, it wasn’t designed to force two different cultures together and create a new one.

Yet over the past 15 years, the employees of Renault and Nissan have worked hard as partners to seize the opportunities before them. We embraced an attitude of mutual respect, while maintaining our separate and distinct cultures.

Unlike most mergers, there was no “loser.” We both won. Together, we have grown from second-tier, largely regional automakers in 1999 to become the fourth largest automotive group in the world:

Last year, we sold 8.3 million vehicles – one in 10 globally.
Our combined revenues were $150 billion, which means if we were one company, we would rank among the top 20 globally.
We employ 450,000 people.
Today we have several automotive partners: Daimler in Germany, Dongfeng in China, Mitsubishi in Japan, Ashok Leyland in India, and AVTOVAZ in Russia.
We continue to explore and find new ways to become more efficient and innovative.
We are the undisputed leader in zero-emission vehicles, and we are leading the charge in autonomous drive technology.

Like the Arab world itself, I believe we are still far from reaching our full potential. We know there are many more opportunities to be seized. But there’s no disputing that our cross-cultural diversity is our strength and a fundamental reason for our success so far.

When we began this journey, some of our people feared what lied ahead – they feared the uncertainty of it all. But they also realized they had no choice, that to continue as they were was a losing proposition, and the Alliance offered opportunity. In time, they learned to see the many possibilities the Alliance presented.

"Our differences and challenges can, over time, be turned into wealth and opportunity, just as they have within the Renault-Nissan Alliance. Our diversity is, in fact, the one thing we all have in common."

Ladies and gentlemen, our differences are many, our potential is great. So are our challenges. Some argue they are insurmountable. I disagree.

Our differences and challenges can, over time, be turned into wealth and opportunity, just as they have within the Renault-Nissan Alliance. Our diversity is, in fact, the one thing we all have in common.

We cannot stop imagining new possibilities. To do so is to give up hope.

In that spirit of diversity and hope, and on behalf of the Alliance, I sincerely thank you for this award.