This article originally appeared in LinkedIn Pulse, authored by Louise Vella.
Introduction
Succession planning is often described as “who comes next.” But in reality, it is about something far deeper: governance. Good governance ensures that succession is not just a personnel decision but a carefully structured process that balances continuity, family influence, and professional management.
The story of Swarovski, the Austrian luxury crystal and jewellery business founded in 1895, provides a timely reminder of why governance is at the heart of succession planning. For over a century, Swarovski was synonymous with family ownership and management. Generations of Swarovski family members not only owned the business but also controlled its leadership.
Yet by the early 2020s, a series of external shocks and internal struggles forced the company to rethink its approach. COVID-19 had battered the luxury sector, market dynamics were shifting, and family disagreements over strategy led to leadership instability. It became clear that survival and growth could not be achieved without professionalising governance.
Informed by the IMD business school analysis “Swarovski: How to Shine Through Stormy Weather? ” by Professors Niccolò Pisani and Stéphane J.G. Girod, this article explores how Swarovski’s leadership transition demonstrates that governance — not just succession — determines resilience and long-term success.
The Context: Pressures on a Family Business
By 2019, Swarovski was facing intensifying challenges. The company, long a leader in the costume jewellery market, was experiencing pressure from both the high end (luxury houses like LVMH and Richemont) and the lower end (fast-fashion retailers like H&M and Inditex). Digital disruption and changing consumer behaviours also eroded the power of Swarovski’s traditional brick-and-mortar retail model.
When the pandemic struck in 2020, the impact was severe. Swarovski’s crystal business saw sales decline by more than 30%. Store closures, global travel bans, and falling demand for discretionary luxury goods left the company vulnerable.
Leadership tensions compounded the crisis. Robert Buchbauer, a family member who became CEO in April 2020, sought to reposition Swarovski as a high-end luxury player. His plan involved significant restructuring, including closing stores and laying off thousands of employees. But other family members opposed these measures, citing risks to the company’s heritage and its community in Wattens, Austria, where Swarovski has been headquartered for over a century.
Eighteen months later, Buchbauer resigned — the latest casualty of a family governance system that struggled to align around a common vision. The leadership vacuum underscored the need for a new governance model.
The Governance Shift: From Family-Managed to Family-Owned
Swarovski made a fundamental shift in 2022 by appointing Alexis Nasard as its first-ever external CEO in its 127-year history.
This was not simply a change of leadership. It was a change of governance.
By appointing an external CEO, Swarovski signalled that it was moving from a family-managed business to a family-owned business. The family would retain ownership and board influence but would no longer insist on direct control of executive leadership.
This distinction was critical. It reassured external stakeholders that Swarovski would benefit from professional management while preserving family heritage. Internally, it provided a face-saving narrative: the family was not giving up control but modernising its governance to secure the future.
As Luisa Delgado, Chair of Swarovski’s Board, stated at the time: “With the appointment of Swarovski’s first external CEO, we are taking an important further step in establishing a sustainable governance model.”
Strategic Reorientation Under New Leadership
Governance change quickly translated into strategic change. Under Nasard’s leadership, Swarovski launched a revitalisation program designed to restore growth and relevance:
Sharper brand positioning: The brand doubled down on its crystal heritage while adapting its messaging for younger, digitally savvy consumers.
Retail reinvigoration: Swarovski refurbished its flagship stores and experimented with experiential retail concepts, blending physical and digital engagement.
Product innovation: New product lines, including lab-grown diamonds, responded to sustainability and ethical sourcing trends.
Cultural collaborations: Partnerships and creative campaigns boosted Swarovski’s relevance in global fashion and entertainment markets.
Importantly, these initiatives were possible because governance reform had created space for professional management. Without resolving the governance question, strategic execution would have remained hostage to family disagreements.
Early Signs of Success
By late 2022, reports from Vogue Business indicated Swarovski’s revenues were rebounding, reaching approximately €1.83 billion. Financial Times coverage in 2023 suggested further progress, as the revitalisation strategy gained traction.
While Swarovski still faced competitive and structural challenges, the early results validated the decision to separate ownership from management. For the first time in years, Swarovski was demonstrating that professional leadership could deliver growth while the family retained its symbolic and financial stake.
Lessons for Succession Planning
Swarovski’s experience illustrates broader lessons for family businesses grappling with succession:
Governance matters more than individuals.
Appointing a successor is not enough. Without governance structures that clarify roles, responsibilities, and decision-making authority, even talented leaders will fail.
Narrative shapes acceptance.
By framing the transition as “family-owned, not family-managed,” Swarovski provided a narrative that honoured tradition while embracing change. Language matters in governance transitions.
Succession and strategy are inseparable.
A leadership transition will only succeed if it enables tangible strategic action. Swarovski paired governance reform with clear initiatives in product, retail, and brand positioning.
Professionalisation does not mean loss of identity.
The Swarovski family remained deeply involved at the board level. Ownership continuity coexisted with professional management — a model that many family businesses can emulate.
Practical Takeaways for Family Businesses
For leaders, boards, and advisors in family enterprises, Swarovski’s case offers actionable insights:
Articulate the transition story.
Position governance reforms as evolution, not disruption. This builds internal alignment and external trust.
Introduce change gradually.
Consider staged transitions — for example, bringing in external executives under family oversight before full leadership transfer.
Link governance reform to visible results.
Tie leadership changes to brand, product, or operational initiatives that stakeholders can see.
Measure early wins.
Use key performance indicators — revenue recovery, store performance, brand engagement — to demonstrate the value of governance change.
Conclusion
Succession planning is ultimately about governance. Swarovski’s journey shows that leadership appointments cannot succeed in isolation. Only when governance structures evolve to match business realities can succession deliver lasting results.
For Swarovski, the move from family-managed to family-owned governance was transformative. It preserved the company’s heritage while unlocking the benefits of professional management. The result was not just survival but the foundation for renewed growth.
For other family businesses, the message is clear: legacy and modernisation are not opposites. With deliberate governance, clear communication, and a willingness to adapt, succession can secure both continuity and competitiveness.
Governance is not the backdrop to succession — it is the stage on which succession succeeds or fails.
Sources
Pisani, N., & Girod, S. J. G. (2023).Swarovski: How to Shine Through Stormy Weather? IMD Case Study, Lausanne: International Institute for Management Development.
Vogue Business (2022). Swarovski names its first-ever external CEO from McKinsey.
Business of Fashion (2022). Swarovski names first external CEO.
Financial Times (2023). Swarovski’s turnaround shows early signs of recovery.
How I Can Help: Turning Family Legacy into Governance Clarity
Swarovski’s journey proves that clarity, planning, and governance can make all the difference. If you’re curious how your family business can do the same, let’s connect and explore succession, governance, or long-term strategy tailored to your business.