France Telecom rallies around chief executive

FRANCE Telecom’s executive board agreed yesterday to keep chief executive Stephane Richard in his job after he was put under investigation for fraud allegedly committed during his time as a top government aide.

The board said after an emergency meeting in Paris to decide his future that it had full confidence in Richard to pursue his leadership of the 27 per cent state-owned group, which also goes by the Orange brand.

“The board considers that the legal measures affecting Stephane Richard do not impede his ability to fully and effectively lead Orange as its chairman and chief executive officer,” the board said in a statement.

Richard was a top aide in the finance ministry under former President Nicolas Sarkozy when his government in 2008 awarded tycoon Bernard Tapie €285m (£242m) in damages in a legal dispute with defunct bank Credit Lyonnais.

His future at France Telecom has been in doubt since magistrates last week opened a formal investigation into his role in the award. Richard denied wrongdoing and is appealing against the decision to put him under investigation.

The company’s shares closed up 3.08 per cent on the day, making it the biggest gainer on France’s CAC 40 index, with investors relieved that Europe’s fourth-biggest telecom group would not face a leadership vacuum.