“Everyone imagines that I was heir to a great family fortune,” Lauder writes. “They forget that I had to build the fortune first.”
Going Public
So, why take his wildly successful company public? Lauder notes the obvious: “to make a lot of money.” But he also suggests that the move was a form of succession planning.
“Money has the potential to divide families and cause lasting rancor, resentment, and bitterness,” he writes. “Going public took the issue of money off the table.”
(Left unmentioned was the fact that the initial public offering was structured to allow Lauder’s brother and mother to dodge a potential capital gains tax of $95 million, which led to a revision in Federal tax law; the Lauders subsequently paid a reported $40 million in taxes for the maneuver.)
Lauder had been wealthy for decades; now, with an estimated net worth of $24.6 billion, he’s become one of the richest people in the world. Understandably, when he stepped away from the company, he stepped up charitable giving.
The closing section of Lauder’s book is dedicated to his family’s philanthropy, including Wharton’s Lauder Institute of Management & International Studies, the Breast Cancer Research Foundation, Memorial Sloan Kettering hospital’s Evelyn H. Lauder Breast Center, the Alzheimer’s Drug Discovery Foundation, the Whitney Museum’s Leonard A. Lauder Building (Lauder says he didn’t know they were going to name it after him, “and I’m not being modest”), the Leonard A. Lauder Research Center for Modern Art at New York’s Metropolitan Museum of Art, and the $1 billion Leonard A. Lauder Cubist collection, which he pledged to the Met in 2013.
Still, Lauder can’t help bring it back to his business.
In a final list of “leadership lessons,” he includes such entries as “Cut your losses” and “It’s my neck,” but the fourth, “Never make an important decision without a woman at the table,” rings as the most heartfelt.
“Growing up with a mother like Estée Lauder,” he writes, “how could I not respect and seek out smart, tough women?”
This story was provided by Bloomberg News.