PARIS - Mr Bernard Arnault, the head of the LVMH luxury goods empire, announced on Jan 25 that he had nominated two more of his children to sit on the company board, a move to cement his family’s control of Europe’s most valuable conglomerate.
Those appointments, subject to the approval of a 15-person board, essentially lock in four of Arnault’s five children as the chief decision-makers of the company, furthering a succession strategy that Mr Arnault, France’s richest man, has meticulously mapped for years in a bid to extend LVMH’s legacy into the next generation.
Mr Arnault, 74, made the announcement as he shared LVMH’s 2023 financial results. Despite economic slowdowns in Europe, the United States and China, the company’s biggest markets, sales for the year were up 9 per cent, to €86.2 billion (S$125 billion). Net profit rose 8 per cent to €15.2 billion – a record for the company.
“Our performance in 2023 illustrates the exceptional appeal of our brands and their ability to spark desire, despite a year affected by economic and geopolitical challenges,” Mr Arnault said. Sales were driven by clothing and leather goods, as well as perfumes, cosmetics, watches and jewellery.
Mr Arnault nominated his sons Alexandre Arnault, 31, who is executive vice-president of product and communications at Tiffany & Co, and Frederic Arnault, 29, chief executive officer of Tag Heuer. They will join two older siblings: Delphine, 48, who is also chair and CEO of Christian Dior Couture, and Antoine, 46, who runs multiple LVMH brands and is in charge of the group’s image and sustainability efforts. The youngest sibling, Jean, 25, is Louis Vuitton’s watch director.
“As I have always said, LVMH is a family-run group,” Mr Bernard Arnault said in a statement. He said the two brothers “will each bring interesting perspectives”.
Over three decades, Mr Arnault has forged LVMH into the world’s largest luxury group and the most valuable company in France. Its brands – 75 of them – are the stars of the luxury world and include Louis Vuitton, Christian Dior, Tiffany and Dom Perignon Champagne.
Mr Arnault has long worked to ensure that the conglomerate – which he created by acquiring European luxury brands that had been weakened by the families that owned them – will stay firmly in his own family’s hands. He persuaded the board in 2022 to raise the mandatory retirement age for the CEO and chair to 80, from 75, and created a corporate structure that ensured that his children – each of whom has executive roles in the company – would remain the top decision-makers.
Such moves have ignited speculation of competition among the siblings over who will one day succeed their father. Mr Arnault brushed off such talk in an interview last summer with The New York Times, saying: “The best person inside the family or outside the family should be, one day, my successor. But it’s not something that I hope is a duel for the near future.”
In 2022, Forbes named Mr Arnault the world’s richest man, a perch he lost when LVMH’s share price slumped around 20 per cent amid weakening growth in the demand for luxury goods. He now holds the title of the second-richest person in the world, according to Forbes, eclipsed by Mr Elon Musk.
In 2023, LVMH was also toppled as Europe’s most valuable company by Denmark’s Novo Nordisk, the pharmaceutical firm that makes Ozempic and Wegovy, the popular drugs being used for weight loss. NYTIMES
