The Notre Dame Fire was Good for the Fashion Industry
Why LVMH and Kering will benefit from their donations to the reconstruction of one of France’s national symbol.
On Monday, April 15th, 2019, a fire broke out at the Notre Dame cathedral shortly after the building closed. As the 850 years-old building engulfed in flames, Francois-Henri Pinault, head of luxury group Kering (who owns Gucci and Saint-Laurent) pledged to donate €100 million to the reconstruction of the cathedral.
Hours later, Pinault’s rival and head of LVMH group Bernard Arnault topped Pinault’s donation by pledging to donate €200 million to Notre Dame De Paris. This action was quickly matched by the Bettencourt-Meyer family, the largest shareholder of the L’Oreal group, who also pledged to donate €200 million. In total, around €850 million of private donations was collected by the French government.
In the context of France’s Gilets Jaunes populist movement, the heads of those luxury groups faced a heavy backlash: the people say the money should have been directed elsewhere and that the donations show the evidence of extreme wealth inequality within France.
Charitable donations usually benefit from a more than 60 percent tax deduction in France, which brought up the question of whether or not Pinault and Arnault’s donations (among others) were as magnanimous as they appeared.
Pinault issued a statement on Wednesday, April 17th, stating that they will be “renouncing any tax advantages it might get from this donation.” The LVMH group, which had benefited from large tax breaks to build the Louis Vuitton Foundation in Paris, said in a response to questions from Reuters “the only thing at issue here is to try and raise as much funding as possible to address this urgent issue, and that goes beyond any tax or accounting calculations.”
Yet, despite the backlash they faced, LVMH and Kering will benefit from their donations to the reconstruction of one of France’s most cherished national symbol. As #NotreDame lit up social media feeds and front pages around the world, the Pinaults and Arnaults have successfully presented themselves as keepers of French heritage.
The truth is, those donations align with the Fashion Industry’s long attachment to the European cultural heritage and their attachment to fashion capitals such as Paris. “It has long been the business interests of LVMH and Kering to publicly align with — and help preserve — European cultural institutions. Such projects help to further embed luxury empires into the fabric of European culture, giving their products greater cultural legitimacy” stated the Business Of Fashion.
Indeed, Paris is the world’s first fashion capital; when shoppers buy French luxury brands, they are looking to buy a piece of culture above just the item of clothing. Madeleine Czigler, Fashion Professor at the American University of Paris explains “I think it’s part of their story, a part of being an influencer in beauty, quality, refinement and history. It’s a story that comes from the Renaissance with the Medicis contributing to the cultural life of Florence. Truth is, both Pinault and Arnault wish to be Medicis: both of them have museums, support Parisian culture- this donation from them is not shocking.”