Lacoste, an internationally renowned leisurewear brand, was a company owned by the family, having been founded in 1933 by legendary tennis player Rene Lacoste.
It hit crisis in 2012 over a feud within the family, despite a strong recent history in terms of business management. Indeed, the company had successfully recovered from a mini-crisis of brand prestige in the late 1980s/early 1990s.
Handling successions posed particular challenges. There was a difficult, but ultimately effective succession from 2nd generation Bernard to his brother Michel in 2005, then an unsuccessful handover to 3rd generation Philippe in 2008-2009. Another feature was the relatively high influence of family members with inherited shares and relatively little knowledge of the business. The constitution was not updated after its drafting in 1986.
Learning Objective
- To understand the importance of strong rules for governance, and development of professional ownership through education, within a family-owned business.
- To explore whether a sense of entitlement through possession of the family name can undermine the principles of good governance. The importance of planning and executing succession at the senior level of a family firm is also to the fore.
