Bernard Arnault’s long-term, family-driven view on luxury extends to himself.
On Thursday, shareholders of LVMH Moët Hennessy Louis Vuitton voted 81.6 percent in favor of a resolution to extend to 80 the age limit for its longtime chairman and chief executive officer, who is 73. Previously the company’s bylaws fixed 75 as the age limit for serving as CEO.
Dressed in a slim-fitting suit the same shade of blue favored by French President Emmanuel Macron, the luxury titan was in fine form on Thursday morning as he presided over LVMH’s first in-person annual shareholder’s meeting in three years. He touted the group’s “remarkable performance” in 2021, when revenues in its key fashion and leather goods business division vaulted 42 percent versus 2019 — and cracked jokes when the voting machinery got glitchy ahead of resolutions concerning his remuneration.
Arnault also indulged in some of his signature hyperbole, boasting that Christian Dior, one of the crown jewels of the diversified group, is a French name even more famous than Napoleon.
He also noted that LVMH improved its performance to such a degree in 2021 that its operating profits, which came in at 17.2 billion euros, approximate the revenues of other luxury groups — a veiled dig at smaller rival Kering.
Operating profits in 2021 were double those of 2020, and 49 percent higher than in 2019 before the pandemic hit.
Shareholders sat rapt at the Carrousel du Louvre as Arnault extolled his conviction that luxury goods is a long-term play, not a quarterly race, and one best shepherded by family with skin in the game.
Four of his five children — Delphine, Antoine, Frédéric and Jean — sat in the front row of the audience, interspersed with other LVMH brass. (Alexandre Arnault, an executive vice president at Tiffany & Co., is based in New York.)
“You are not shareholders in some anonymous group; therefore, you are part of the family,” he told the room, flashing a warm smile.
He also reiterated that “profits are a consequence of what we do” rather than a goal in itself, extolling the four key values of the group: creativity; an entrepreneurial spirt; excellence in products and retail experiences, and a commitment to doing good for the environment and society.
Shares in LVMH have gained about 25 percent since Jan. 1, but it’s not a point of pride for Arnault. “I never look at the stock exchange,” he asserted.
He reiterated his skepticism about the metaverse, even questioning Facebook’s name change to Meta. “There’s no need to rush. We should be prudent,” he said, suggesting that digital fashions for avatars is not in LVMH’s DNA. “We want to sell real products.”
While some brands are hawking virtual sneakers, Arnault touted the record-breaking auction last February that saw 200 pairs of Louis Vuitton and Nike “Air Force 1” sneakers by Virgil Abloh sell for a total $25.3 million, all to benefit the Virgil Abloh “Post-Modern” scholarship fund.
Arnault also paid tribute to Abloh, founder of the Off-White label and creative director of Vuitton menswear until his death last November at the age of 41, inviting shareholders to view the “Coming of Age” exhibition dedicated to him at the Fondation Louis Vuitton until April 27.
The executive trumpeted that Tiffany, which LVMH acquired last year, is “developing better than expected” and that its Fifth Avenue flagship in New York City, currently under renovation, should be ready by the end of the year.
LVMH conscripted French economist Nicolas Bouzou to delve into LVMH’s wider impact on the French economy. The study found that LVMH is responsible for generating some 145,000 jobs in France and adds a total of 36.6 billion euros to the economy.
The luxury conglomerate, which owns 75 brands including Fendi, Loewe, Bulgari, Dom Perignon, Sephora and Guerlain, exports 75 percent of what it produces, an amount bigger than the pharmaceutical industry, according to Bouzou’s study.
In a lively presentation, Antoine Arnault, head of image and environment at LVMH, detailed the group’s eco progress, plucking from under the podium a pair of colorful upcycled Vuitton sneakers and then a Loewe bag woven from strips of discarded leather that is currently out of stock.
He highlighted that 57 percent of the group’s boutiques are fully LED, while 81 percent of leathers used are certified LWG and 61 percent of cotton is certified, up from 74 percent and 51 percent versus a year ago, respectively.
He said the group is aiming to have 100 percent of its products eco conceived by 2030, and to reduce emissions by 55 percent in the same time frame.
Chantal Gaemperle, executive vice president of human resources and synergies at LVMH, described progress in diversity and inclusion, noting that women now occupy 44 percent of key posts at LVMH, versus only 23 percent in 2017.
The group also continues its policy of grooming and promoting talent from within. Last year, 75 percent of key posts were filled internally, with a total of 5,580 employees getting promotions.