Google+

BBC Capital

Six tales of top-level workplace nepotism

  • All in the family

    It’s a tale as old as business itself. Leaders, reluctant to give power to an unknown outsider, have handed the reins to someone in the family tree. Granted, kin may have a top-tier education and experience in the business, but it’s often hard to know whether there might be someone better for the job.

    Though nepotism is often looked on unfavourably in modern-day business, the practice is far from outmoded. A more subtle form of nepotism, hiring the children of the rich or well-connected — ostensibly to win business or favor — is also evident across industries. The latest public example: authorities in the United States are looking into whether JPMorgan Chase & Co hired the offspring of officials in China to give their business a boost.

    From banking giants to global media powerhouses, a look at some of the most public examples of nepotism — or at least keeping plum posts in the family — in business. (Getty)

  • JPMorgan Chase & Co’s China connection

    JPMorgan Chase has come under scrutiny by US federal authorities over whether the global mega bank hired the children of Chinese officials “to help the bank win lucrative business in the booming nation”, the New York Times reported, citing a confidential US document.

    Among other things, the bank is said to have brought on Tang Xiaoning, son of Tang Shuangning (pictured), chairman of the China Everbright Group – a conglomerate controlled by the Chinese government. Shortly after Shuangning joined JPMorgan, the bank scored multiple “coveted” assignments from Everbright, according to the New York Times.

    “Global companies also routinely hire the sons and daughters of leading Chinese politicians,” the New York Times reported. “What is unusual about JPMorgan is that it hired the children of officials of state-controlled companies.”

    The investigation into whether these hirings helped the bank win lucrative business from Chinese state-controlled companies is ongoing. (Getty)

  • An announcement rocks Rolling Stone

    Multi-millionaire co-founder and publisher of Rolling Stone magazine Jann Wenner raised eyebrows earlier this year when he appointed his 22-year-old son, Gus Wenner, head of Rollingstone.com. The junior Wenner, a new graduate of Brown University, was charged with heading all aspects of the dot-com business after having worked for the site for just “six or seven” months, according to an Adweek story. Before that, his biggest claim to fame was his role in his collegiate alt-country band.

    Perhaps the elder Wenner’s decision to give his son so much power was based less on nepotism and more on experience: Jann Wenner was only 21 years old when he founded Rolling Stone — and not even a college graduate, at that. (Getty)

  • Trump: A family legacy

    Multi-millionaire real estate tycoon Donald Trump has never been shy about affording special privilege to his children. At 31, his daughter Ivanka Trump is a celebrity in her own right, with a successful modeling career and a line of jewelry, handbags, footwear and outerwear that follow in the vein of her father’s unapologetically over-the-top style. Ivanka has been forthright about her privileged upbringing.

    “Of course, nepotism got me in the door. It would be silly to say otherwise,” she told ABC News in a 2009 interview. “But if I was not performing in a way that was satisfactory… I could not stay within the organisation.”

    Although Ivanka is the most high-profile Trump child, her brothers – Donald Jr, 35, and Eric, 29 — work in the privately-held Trump Organization; Donald Jr. as executive vice president and Eric as executive vice president of development and acquisitions. (Getty)

  • Rupert Murdoch’s non-retirement plan

    The head of the News Corp conglomerate is no stranger to accusations of rampant nepotism. He’s been roundly criticised by investors for his decision to place his sons Lachan, 32, as deputy chief operating officer of News Corp and James, 31, as CEO of British Sky Broadcasting Group, which is partially owned by News Corp. Investors say these appointments, at News Corp-owned posts, have hurt the company.

    Murdoch expert and author Neil Chenoweth told Bloomberg that “[investors] believe in the father, but not the sons. It's not going to work once Rupert's not there.”

    But succession may be the least of Murdoch’s concerns: the media maven says he isn’t concerned about leaving the News Corp legacy in his son’s hands; he apparently plans to live forever. Well, almost: the fitness-minded 82-year-old Murdoch has told reporters he has “no plans to retire,” and hopes to live to 120 — “but certainly 100.” (Getty)

  • Sumner Redstone’s succession question

    Who will inherit one of the biggest media companies in the United States? For Sumner Redstone, 89, who heads up an entertainment empire which includes Viacom, CBS and Paramount Pictures, that question remains up in the air.

    Redstone’s daughter, Shari (pictured), who now serves as president of Viacom-owned National Amusements as well as vice-chairwoman of CBS Corp and Viacom, is one possible candidate — but she’s no sure thing. Despite her lofty position in the company, her relationship with her CEO-father has been a rollercoaster ride. The pair were embroiled in a very public feud after Shari fought for Sumner Redstone to name her chairman and controlling shareholder of Viacom and CBS after her father’s death. Sumner Redstone reportedly threatened to oust Shari from the company altogether.

    She eventually backed down. Though the pair have since reconciled, Sumner Redstone still refuses to guarantee Shari ascendancy. Another obvious candidate for the position is Viacom CEO Philippe Dauman.

    “[Philippe] knows that Shari might be my successor… it's not a competitive race between them. We have to see what happens” Redstone told the Wall Street Journal.

    But it doesn’t take a crystal ball to realise Redstone may be playing the two against one another to see who works hardest in the company. "Competition brings out the best in any CEO," Mr Redstone said. "I encourage them to compete." (Getty)

  • McGraw-Hill: End of a family dynasty

    James H McGraw started McGraw Hill as a small publishing company in 1888. More than a century later, in 1993, his great-grandson Harold “Terry” McGraw Hill became president of the company. There were initial doubts about Terry McGraw’s ability to lead. According to a 2005 New York Times article, “many thought Mr McGraw… was yet another heir who had lucked into a job he could not handle.”

    The company's Standard & Poor’s ratings unit is the subject of a $5 billion federal lawsuit over its favourable ratings of complex securities whose collapse helped fuel the financial crisis. In 2009, McGraw was forced to sell the company’s venerable business magazine, BusinessWeek, to Bloomberg LP for under $5 million.

    And two years ago, Terry McGraw gave in to investor pressure, announcing the company would be split in two, decoupling its less-profitable education unit from its other holdings, including S&P and JD Power & Associates. The next CEO for the company will be Douglas Peterson, President of Standard and Poor's Ratings Services, effective 1 November. (Getty)

    (Correction: An earlier version of this article stated that the company had not yet chosen its next CEO. The present version has been changed to reflect the new leadership. A confusing reference to "hard times" has also been removed).

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.