Shareholders seek transparency regarding LVMH succession strategy
Investors in the French luxury conglomerate LVMH are increasingly voicing concerns over the lack of a clear succession plan for Bernard Arnault, the chairman and chief executive officer (CEO) who has led the group for nearly 40 years. According to a report by Reuters, some shareholders now view the absence of a public transition strategy as a growing corporate risk for the 350 billion dollar group.
Arnault, who is 76 years old, oversees an empire of more than 70 brands, including Dior and Tiffany & Co. While all five of his children hold significant roles within the organization, he has not publicly designated a successor. In April 2025, the company extended the age limit for his dual role to 85, a move some investors interpret as an attempt to delay a definitive decision.
Governance concerns and market impact
The ambiguity surrounding the future leadership of the group is beginning to influence investor sentiment. Stefan Bauknecht, equity portfolio manager at Deutsche Bank's DWS, which is the 12th-largest shareholder in LVMH, told Reuters that “the succession planning, as of now, appears unclear and opaque.” Bauknecht added that the firm desires “more transparency and a plan on how things will evolve.”
Financial analysts suggest this lack of clarity could lead to a valuation penalty. Ariane Hayate, European fund manager at the Paris-based Edmond de Rothschild, noted that while succession was not a priority a decade ago, it has since evolved into a “risk factor” that contributes to a “governance discount on the company.”
Internal structures and family dynamics
In response to inquiries from Reuters, LVMH stated that while executive succession plans are not made public, “obviously they do exist.” The group further clarified that these internal strategies account for both medium-term goals and the possibility of “sudden events.”
Current governance filings from a 2022 restructuring reveal that Arnault’s five children—Delphine, Antoine, Alexandre, Frederic, and Jean—each hold a 20 percent stake in Agache Commandite SAS. This entity is designed to take control of the family holding company upon Arnault's departure. However, experts have raised concerns regarding potential friction. Eric Pichet, a professor at Kedge Business School specializing in corporate governance, described the situation as a “time bomb,” noting that “there are always tensions in a second generation. And when you are five, it can’t be avoided.”
Arnault remains focused on long-term tenure
Despite external pressure, Arnault has indicated that retirement is not an immediate priority. In a previous statement to CNBC, he remarked, “talk to me again in 10 years, I can give you a more precise answer.” He expressed his intention to remain at the helm for another decade, barring unforeseen circumstances.
While a majority of shareholders supported the extension of Arnault’s tenure last year, some institutional investors, including Allianz GI and Baillie Gifford, expressed dissent or abstained from the vote, citing insufficient disclosure regarding the transition of power. LVMH is scheduled to report its annual results tomorrow, January 27, 2026.