The Estée Lauder Companies (ELC) has recently taken the industry by storm with some developments within the leadership structure as William P. Lauder has resigned from the duties of Executive Chairman of the Board of the Directors with immediate effect. Lauder a member of the family that started the company has obtained new position as Chair of the Board of Directors while, Stephane de La Faverie is appointed as President and Chief Executive Officer. These changes indicate a completely new management system of the organization which is quite interesting given that it is also the time when the long-serving CEO Fabrizio Freda has announced his retirement.
It is part of a larger strategic shift within the organization. Lauder, who has been a predominant figure in the leadership of the company for decades, explained that his resolve to concentrate exclusively on the Board Chair position reflects how the family has scaled back on the running of the business. In that respect, Lauder observed, “Our family’s management of the business on a daily basis, which has been the case for so many years, is in the course of change. This evolution out of necessity represents a considerable step for the Lauder family, so that I can now concentrate on strategizing the vision of the company.” He however also stressed the fact that the members of the family have not become inactive in their interests in Estée Lauder Companies. Speaking about the family’s presence in the company, he referred to its members as strategic investors in the company who are looking for long-term investments.
The transition in leadership comes on the heels of almost rival or sub-rivalrous developments that have been raised by the prospects of the company, with the latest being the retirement announcement of Freda after 16 years as the CEO. Moreover, there has been speculation that another member of the Lauder family, Jane Lauder, is also likely to scale back on the daily operations; however, there has been no official statement regarding her involvement whatever that may be.
The seasoned managerial executive who previously led the company’s most significant parts, Global Brands and The Americas, will, in turn, become the new President and Chief Executive Officer of Estée Lauder Companies. His appointment, as many opine, is a manifestation of the company’s long-term objectives of carrying out extensive restructuring so as to remain competitive in the changing global beauty sector.
With this announcement, the doors commence a new phase in Estée Lauder Companies’ life where more management control is exercised at the corporate rather than at the divisional level while still preserving the influence of the Lauder family through the Company’s structure.
