Who Needs a CEO Anyway? This Luxury Goods Retailer Thinks it Doesn’t

Richemont, the Swiss luxury goods company behind brands including Cartier jewelery, Montblanc pens and IWC watches, has gone one better than scrapping its co-CEO model. It's decided to jettison the CEO role altogether.

The heads of Richemonts’ various brands will instead report directly to the board, headed by Chairman and company founder Johann Rupert.

It wasn’t long ago that Richemont had two CEOs. In March, co-CEO Bernard Fornas stood down, leaving Richard Lepeu with the job all to himself.

Now, Lepeu will stand down this coming March and won’t be replaced, the company announced this morning.

“The board is really there to allocate capital and human resources. This is a more sensible and fairer structure.

It’s difficult to recall a large publicly-traded company deciding to go without a CEO, though it’s not unheard of for chairmen to occupy the role in a dual capacity temporarily in the event of a sudden and unplanned departure while new blood is found.

And there are instances of smaller, more entrepreneurial businesses rejecting a hierarchical management structure outright.

The founders of travel insurance company Seven Corners, for example, last year relinquished their co-CEO roles because they feared they’d dominated all leadership discussions, stymieing growth. As reported by Forbes, Jim Krampen and Justin Tysdal spread management responsibilities across different functions, with Krampen becoming Chief Revenue Officer and Tysdal Chief Strategy Officer.

In Richemont’s case, however, the executive departures may concentrate more power in the hands of its billionaire founder.

“It is impossible to replace Richard and appoint a new person who will take care of 35 direct reports,” Johann told an analyst call, according to Reuters. “The board is really there to allocate capital and human resources. This is a more sensible and fairer structure.”

Johann has served as Richemont CEO before, though he said Friday that he wouldn’t become more involved in day-to-day management duties. Rather, he would continue on in his capacity as “an air traffic controller of egos.”


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