The Estee Lauder Companies faces a period of uncertainty as it navigates significant organizational changes.AdobeStock by Robert
According to the Wall Street Journal, tensions within the Lauder family have escalated, leading to significant changes at The Estée Lauder Companies. In addition to a new CEO, two members of the Lauder family found their direct roles in the company downsized.
A private letter from Jane Lauder reportedly sent to select board members in early September 2024 expressed concerns about William Lauder’s leadership and called for his removal.
The family’s disagreement over the company’s strategic direction and future leadership has reportedly been brewing for over a year. Jane Lauder, while considered for the CEO role, lacked the desired financial and operational experience, per the report. As a result, the board opted for a different candidate, Stephane de La Faverie.
The company has faced challenges, including declining sales in China and a significant drop in stock price. With the departure of both William and Jane Lauder from executive roles, there will no longer be any members of the Lauder family in executive roles at the business.
“This is a difficult time for the company, and we believe deeply that we can best serve the company’s return to profitable growth by contributing more fully as members of the board and as stockholders,” William told Wall Street Journal.
The Estee Lauder Companies shared the following message in November of 2024 to all global employees:
“As you heard from William and Jane last week, they have made the decision to step away from their operational and managerial roles during this time of transition and turnaround to dedicate themselves to serving the Company as members of the Board of Directors, and as stockholders. The Lauder family intends to remain meaningful stockholders, ensuring that our values and our approach to long-term patient capital continue to play a vital role in the Company. To repeat – we will remain meaningful stockholders, and we are committed to this Company for the long term. As we look to the future, we will continue to work with the leaders at ELC to ensure our values are reflected. We are thrilled that Stéphane will be our new President & CEO as of January 1. With more than 25 years in the beauty industry and nearly 14 years with our Company, Stéphane will continue to nurture our incredible brands while driving innovation for the future of prestige beauty.”
The letter was signed by members of the Lauder family, including, Leonard A. Lauder, Ronald S. Lauder, William P. Lauder, Aerin Lauder Zinterhofer, Gary Lauder and Jane Lauder.