Succession at Estee Lauder

Business Times

18-06-2025

THE passing of Leonard Lauder last week (June 14) at age 92 marks more than the end of a personal chapter – it closes an era for one of the most iconic family-run businesses in global beauty. As someone who spent years in the media industry, where beauty advertisers often account for up to 40 per cent of total revenue, I've long held a deep affinity for cosmetic brands – especially Estee Lauder – shaped by both professional experience and personal encounters.
In the early part of my career, I was based in Tokyo, as part of the global leadership ad sales team at Elle magazine. One of the defining memories of that chapter was travelling to New York to present a global partnership programme to the Estee Lauder global leadership team. I was representing Asia, and while I didn't get to meet Leonard Lauder himself, his vision was present in every conversation – the precision, the pride, the promise of timeless beauty.
That season also gave me the privilege of meeting and engaging with some of the most influential figures in the beauty industry – founders and next-generation chairmen and chief executive officers whose names are synonymous with luxury and excellence. I met Hiroshi Uemura of the Shu Uemura family, Yoshiharu Fukuhara of the Shiseido family, and Christian Courtin of the Clarins family. I've always been deeply interested in family entrepreneurship. These weren't just professional encounters – they were windows into the soul of family-owned empires, each grappling with legacy, innovation and succession in their own way.
My connection to Estee Lauder deepened at home. My wife worked under the Aramis brand, part of the Estee Lauder Companies, and I became an Aramis user myself. I could even recognise the distinct scent of White Linen when someone wore it – a reminder of a household legendary brand.
One of my most defining career moments came later, during my tenure as president of Mindshare China, when we won the largest advertising pitch in China's history – the L'Oreal China account, valued at US$2.5 billion. We mobilised over 90 professionals across cities to present a unified brand strategy for L'Oreal Paris, Lancome, Maybelline, and Kerastase. It was a powerful lesson in alignment and storytelling at scale – and deepened my appreciation for how global beauty brands, especially family-founded ones, balance legacy and innovation.
Now, as a family legacy planner, I find myself drawn to examining how the Estee Lauder family navigated succession – not just as a business case, but as a generational journey of values, vision, conflict management, and continuity.
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A succession strategy worth studying
What makes Estee Lauder's journey particularly remarkable – and relevant to those of us in the world of family enterprises – is how it has navigated succession across three generations, blending professionalism with preservation.
Estee Lauder, the founder, built not just a beauty brand but a household name. Her son, Leonard Lauder, scaled the business globally, acquiring key brands and turning the company into a public powerhouse. His son William took over as CEO in 2004 and later transitioned to chairman. Meanwhile, Jane Lauder, a third-generation leader, held key roles in digital transformation and brand management, and was widely seen as a potential successor – until internal dynamics made the path less clear.
In recent years, there were signs of internal disagreement within the family leadership. Public reports alluded to differences in views between Jane Lauder and her cousin William regarding the company's direction. It marked a typical instance of visible tension within a business family long regarded for its cohesion.
Rather than allow the business to be entangled in internal politics, the Lauder family made a bold but measured move: they appointed Stephane de La Faverie, a seasoned executive, as the company's first non-family CEO. Jane stepped down from operational duties but retained a board seat. William moved fully into a strategic governance role.
This was not a retreat. It was a recalibration – a shift from operational control to strategic stewardship.
Control through structure
Even with only about 35 per cent equity ownership, the Lauder family retains 86 per cent of voting power through a dual-class share structure – giving them enduring influence over the direction of the company.
This structure – often misunderstood – has allowed the family to:
Maintain long-term vision and brand values
Avoid short-termism from outside investors
And, when necessary, make difficult but decisive leadership changes
While Estee Lauder Companies faced recent headwinds – notably from slowed growth in China – the leadership transition and ongoing restructuring have been positively received by the market. It's a reminder that well-governed family firms can both adapt and endure.
Lessons I learned
The Estee Lauder story is a living example of how legacy businesses can evolve:
1. Structure is power: With thoughtful planning, families can retain control without needing majority ownership.
2. Letting go is leadership: Knowing when to step back – and how – is often the hardest but most strategic move.
3. Governance evolves: From founder-led to professionally managed, the company's journey shows that values can outlive titles.
4. Conflict happens; resolution must be designed: The family's maturity in managing differences while preserving unity is a lesson for every business family.
5. Brand is legacy: What Estee built was not just a business, but a belief – the promise that every woman can be beautiful. I agree.
Final thought: AI as the next legacy frontier
As someone who has had the privilege of working with and learning from some of the world's most iconic beauty brands – and who now advises families navigating succession and legacy – I find the Lauder story both personal and inspiring.
It reminds us that while brands can be bought, legacies must be built – and guarded.
Now, a new frontier demands equal attention: artificial intelligence. In June 2025, L'Oreal announced a strategic partnership with Nvidia, leveraging advanced AI tools to personalise customer experiences, power virtual beauty consultations, and drive data-driven content creation across its multi-brand portfolio.
As legacy beauty brands transition to professional management, they must also embrace technological transformation. The Estee Lauder legacy story continues.
The writer is a family enterprise adviser and educator