LVMH to Name New Head of Fashion Group Division
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PARIS — LVMH Moët Hennessy Louis Vuitton is preparing to name a new head of its Fashion Group division as Sidney Toledano transitions into another role at the French luxury group, chairman and chief executive officer Bernard Arnault said Thursday.
Speaking at the annual general meeting of shareholders, Arnault thanked Toledano for his leadership during a career at LVMH spanning almost three decades, first at Christian Dior and since 2018 as head of the LVMH Fashion Group, which oversees brands including Celine, Loewe, Givenchy, Kenzo, Marc Jacobs and Pucci.
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“I wanted to underline the exceptional job he has done. He’s not leaving. No, he will take on another role,” Arnault said.
“We will continue to work together in a different framework. I won’t say anything further, but I will tell you about it next year in any case. A big thank you, Sidney, for your terrific work during all these years,” he added, prompting warm applause from the audience.
The luxury executive’s comments come days after a report on independent news site Miss Tweed that Michael Burke, another veteran LVMH executive, was the frontrunner to succeed Toledano as head of the Fashion Group. LVMH declined to comment on the story.
A source with knowledge of the matter said the name of Toledano’s successor would be revealed in the next few months, but the decision had yet to be finalized.
Revenues in the division have swelled under Toledano’s watch and are now approaching 10 billion euros, according to market sources. It is understood Toledano also increased the business unit’s profitability sixfold. Arnault disclosed that revenues at Celine were now close to 3 billion euros.
At the AGM, Arnault also singled out Burke for praise, noting that he had helped Louis Vuitton to become the first brand in the history of luxury goods to generate annual revenues of more than 20 billion euros.
Burke bowed out as chairman and CEO of Vuitton in February after a stellar 10-year tenure to “take up new responsibilities, reporting directly to Bernard Arnault,” LVMH said. He would seem a natural successor for Toledano, since the two men are close, and Burke has been part of Arnault’s inner circle since he founded LVMH in the 1980s.
Responding to a question from a shareholder, Arnault confirmed that LVMH is in talks to become a partner of the organizing committee of the 2024 Olympics in Paris. Worldwide partners include Alibaba Group, Omega and P&G. Carrefour is a premium partner, while Decathlon and Le Coq Sportif are among the official partners.
“Regarding the Olympic Games, the contract you refer to is not signed, it is under negotiation, and like any negotiation, it can end with an agreement or not. So stay tuned,” Arnault said.
Arnault, who recently surpassed Elon Musk as the world’s richest man, also hit back at critics a week after protesters forced their way into LVMH’s Paris headquarters as part of ongoing protests against President Emmanuel Macron’s pension reform law, which raises the retirement age from 62 to 64 years old.
Some opponents of the measure have suggested taxing the rich to help fund the pension system instead of asking people to work longer.
“In France, we are criticized,” said Arnault, referring to an unnamed politician who he said had called for the scrapping of the luxury good industry on the grounds that it produces superfluous products.
“Luxury employs 1 million people. So here you have a supposedly responsible politician who is ruthlessly calling for the elimination of a business that employs 1 million people. I’ll let you be the judge,” Arnault continued.
He noted that LVMH, the parent company of brands including Vuitton, Guerlain, Sephora and Moët & Chandon, invests more than 1 billion euros per year in France and hired 15,000 people in its domestic market in 2022.
Arnault also referred to the recent controversy surrounding LVMH’s plan to build a research laboratory on land adjacent to the prestigious Ecole Polytechnique engineering school. LVMH said in January that it would find another location for the 100-million-euro project after current and former Polytechnique students opposed the proposal.
“They said, ‘No, no, it’s better if the state funds it.’ We’ll see. For the time being, it’s an empty field with a couple of frogs in it. We’ll see in 20 years if they’ve done anything with it. In any case, we pulled out because there’s no point getting upset about it,” he said.
“We’ve been invited all over the world, namely in England, in prestigious universities that were not only ready to welcome us, but wanted to subsidize us as well. We’re good French citizens, so we will nonetheless remain in France. Despite all the critics, we remain attached to France,” he said.
Claude Martinez, who recently stepped down as head of Parfums Christian Dior, will supervise the group’s research activities, Arnault added.
Later that day, his son, Antoine, presided over his first AGM as CEO of holding company Christian Dior SE, which controls LVMH. He paid tribute to Toledano, who preceded him in the role, and saluted his father in comments that signaled the luxury magnate is not ready to hand over the leadership of his group to any of his five children.
“He is today the cement of the unity of our family and a driving force to project ourselves, with him, into the future. In these times when those who take risks and succeed are unfairly criticized or even stigmatized, I would like, on your behalf, to thank him for what he has built,” Antoine told the gathering.
Last year, LVMH shareholders voted in favor of a resolution to extend to 80 the age limit for Arnault, 74, to serve as CEO. Previously, the company’s bylaws fixed 75 as the age limit.
Responding to a shareholder’s question, Antoine condemned the invasion of the LVMH headquarters by demonstrators, many wearing CGT union vests.
“It was obviously a very unpleasant moment, one we found quite hard to understand. Some reports said it was a non-violent action. I suggest you tell that to the security guard who was burned, who had smoke bombs waved in his face and whose jacket was completely burned, and who could have died, honestly,” he said. “It was absolutely violent.”
Arnault, who is head of communication, image and environment at LVMH, in addition to his roles as CEO of Berluti and chairman of Loro Piana, suggested that the media was responsible for stoking negative opinions about wealth by reporting on the rankings of the world’s richest people.
“I believe that somewhere, everything you can read about wealth and fortune is presented in a misleading way. When you talk about wealth, you’re not talking about available money, it’s the value of the company in which you are shareholders that’s increasing, which allows us to open more workshops and stores and to continue hiring and training in France,” he argued.
“I was reading last week at around the same time, incidentally, that because the stock had performed well, Bernard Arnault’s wealth had increased by I don’t know how many billion euros, but it’s absurd to present things that way, as if he’d won the lottery and that several billion euros had been transferred to his account,” Antoine continued.
“It’s LVMH as a company that is performing incredibly well,” he concluded. “We should all be happy about that, so we felt this invasion of our headquarters was unfair. We’re part of the solution, not part of the problem.” The audience applauded his comments, which came amid news that protesters had stormed the Paris offices of Pan-European stock exchange Euronext.
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