Danfoss: Legacy of family leadership continues

NORDBERG, Denmark—Generations may pass but leadership remains in the family for global power management company Danfoss Co., as it has since its founding in 1933.

Since 1996, Jorgen Mads Clausen has been at the helm for Danfoss, serving as CEO from 1996 to 2008; and as chairman of the board since 2009.

Clausen will step down as chairman at the March 25 annual general meeting for Danfoss, at which time other changes will be instituted as part of a shift in ownership that occurs once a generation for the company.

Clausen will be succeeded by Jens Bjerg Sorensen, former vice chairman.

"Danfoss is now a stronger, bigger and more global company, but also one with a clear goal of contributing to the green transition and combating climate change with our energy-efficient products and solutions," Clausen said. "This is a result of our business strategy, which is now being updated with an ambitious sustainability strategy."

Though he no longer will be on the board of directors, Clausen said in a March 21 release that he will continue to be accessible, embodying a post-leadership legacy begun by Bitten Clausen, widow of Danfoss founder Mads Clausen.

"Both my siblings and my wife and I are delighted that the third generation of the family is showing their commitment to Danfoss by taking on greater responsibility," Clausen said.

"It has been a pleasure to safeguard my parents' life work for the benefit of Southern Jutland, Denmark, and the world on the path of the green transition. Now it's time for the next generation to take the lead. The timing is right for me."

Clausen said Sorensen possesses the right leadership traits and a unique understanding of the Danfoss culture.

"He can take Danfoss to new levels, together with the rest of the board, management and our employees," Clausen added.

Sorensen previously served as CEO of Schouw and Co.—a Denmark-based engineering services firm—since 2000, and has served as chairman of the board for a number of major companies.

"I am honored to be nominated as the new chairman of the board. Danfoss has an impressive history," Sorensen said. "The foundation based long-term ownership and the family's strong values are one of the main reasons why Danfoss now has a decisive influence on whether the world succeeds in the green transition."

Additional transitions are expected to take place at the March 25 annual general meeting, including:

• William Erwin Hoover Jr. will step down, to be replaced by Karin Dohm on the board of directors. Dohm has served as global head of government and regulatory affairs at Deutsche Bank and a partner in financial services for Deloitte;

• Mads-Peter Clausen, son of Peter Mads Clausen, will continue to serve on the board of directors for Danfoss A/S, of which he has been a member since 2014; and

• Mads Clausen, son of Jorgen Mads Clausen, will join the board of directors at Danfoss A/S.

Incoming Chairman of the Board Sorensen noted that Danfoss "is financially stronger than ever," as evidenced by Danfoss' $3.3 billion acquisition of the hydraulics unit for Dublin, Ireland-based Eaton Corp.

The Aug. 2, 2021, acquisition brought about 10,000 former Eaton employees into the Danfoss fold and adds about $1.8 billion in annual revenue to Danfoss, specifically to the Danfoss Power Solutions segment, which doubled in size with the Eaton Hydraulics addition.

Danfoss leadership has maintained that hydraulics remains a priority for the company moving forward.

Eaton Corp., which maintains its North American headquarters in Beachwood, Ohio, posted 2020 revenues of $17.9 billion, with the hydraulics unit at $1.8 billion. The company sells to customers in more than 175 countries. Eaton now has approximately 96,000 employees.

Danfoss Power Solutions had about $4.7 billion in sales revenue in 2021.

Overall, Danfoss A/S increased by about one-third with the acquisition and brings the overall number of Danfoss employees to about 38,000, with between 17,500 and 18,000 employees now within power solutions.