How does the boss of a family fashion empire make a succession plan when he doesn’t have any children? According to newly reviewed documents, it’s a question that Giorgio Armani has spent years trying to answer.
The fashion billionaire has reportedly provided his six heirs with instructions on everything from the brand’s evolving style to IPOs and mergers, making it likely the 89-year-old’s fingerprints will be imprinted on the company long after he’s gone.
The Italian news outlet Corriere della Sera first reported Armani’s succession plan in October, outlined in an obscure document made up of several bylaws filed in Milan in 2016. The document has since been reviewed by Reuters.
The publications reported that Armani is likely to split the group between his sister Rosanna, his two nieces, his nephew, and his long-term collaborator Pantaleo Dell'Orco, as well as a charitable foundation.
All members in line to succeed Armani are on the group’s board, and will each receive part of a six-bloc allotment of shares.
Instructions on style
Armani, who founded the brand in 1975 with his late partner Sergio Galeotti, expects his successors to "search for an essential, modern, elegant and unostentatious style with attention to detail and wearability" after his passing, Reuters reports.
The bylaws also reportedly outline how the company will appoint women’s and men’s style directors in the future.
But there are also lengthy financial instructions, according to the outlets. Armani has given guidance on any public listing for the company, as well as potential mergers and acquisitions. However, these can only be put in place five years after the co-founder passes away.
Analysis shared with Italian publication Milano Finanza suggested the group could list on the stock market for at least €5 billion ($5.4 billion). The fashion group, which is privately run, took in €2.35 billion ($2.55 billion) in revenue last year.
In 2021, Armani rebuffed an offer from John Elkann, the heir to the powerful Agnelli empire, to tie up the group in a luxury conglomerate that would revolve around Ferrari, Reuters reported.
Armani also reportedly set up a small charitable foundation in 2016 under the auspice of developing it with capital from the company following his passing.
A representative for the Armani Group didn’t immediately respond to Fortune’s request for comment.
The document, reportedly agreed at an extraordinary meeting in 2016, sounds like something straight out of the HBO megahit Succession, where the Roy siblings duel it out for both their father Logan’s affections and, more importantly, his media empire.
Except in this case, no warring offspring are vying for Armani’s throne, and the fashion mogul’s plan for succession is evidently more well thought out than the fictional Logan’s.
Succession plans in focus
Armani is unlikely to have looked to the world of fiction to plan his own succession, having multiple real-life examples to work off.
Founders of several major family-run empires, approaching the point of retirement, are making plans to hand over the reins to their children or other successors. Each appears keen to assuage investor fears that operations will worsen following any handover to their potential familial heirs.
Armani’s European fashion counterpart Bernard Arnault, 74, extended his tenure as CEO of LVMH last year and looks set to continue until he is 80. Waiting in the wings, though, are five of Arnault’s children.
While 48-year-old Delphine, who became Dior CEO in January, is considered the favorite to take over, each sibling holds a management position that could see them make a claim. Other non-family members also stand a chance at succeeding the world’s second-richest person.
In September, 92-year-old Rupert Murdoch announced he would be handing his Fox News group to his son Lachlan, ending years of speculation over which of his three children would eventually take the reins.
In April the FT reported that fellow media mogul Michael Bloomberg, 81, had also begun to think about his own succession plan. Bloomberg president Jean-Paul Zammitt is seen as most likely to take over the CEO role, the FT reported citing people familiar with the matter.
