“We are not a family. We are a firm.”
You may be familiar with this blunt assessment, widely attributed to Queen Elizabeth II’s father, and delivered by Colin Firth in his Oscar-winning performance as the future George VI in “The King’s Speech.”
It’s as true today as it was during George’s reign (1936 to 1952), except now there’s more money at stake for “the Firm”: $28 billion in assets, according to an estimate last year by Forbes magazine. It’s a fortune built largely on real estate accumulated over centuries, from prime London office buildings to palaces, from farms to offshore tracts for wind turbines.
With Elizabeth’s death on Sept. 8 at 96, her son Charles became the country’s monarch — and the Firm’s chief executive. Leadership transitions are difficult for any family business, and King Charles III’s ascension will be no exception.
Perhaps his toughest challenge: how in the future to avoid the awkward circumstances of a septuagenarian royal becoming a rookie CEO. A case — a business case, that is — can be made that Charles should break with a millennium of tradition and not serve until he dies. Instead, the Firm might be better off if he works as a transitional figurehead, then retires and hands the crown to his heir, 40-year-old William.
“He’s at an age when many people step down, not step up,” said Christina R. Wing, a senior lecturer at Harvard Business School, whose research focuses on family enterprises.
At its most basic, Charles’s job is to preserve the monarchy, which has existed in one form or another almost continuously for 1,200 years. He must ensure that it remains politically and financially viable, even as many Britons resent the royals’ privilege and public subsidies, and the inflation-racked UK economy is on the verge of recession.
Over her 70-year reign, Elizabeth emerged as a superb, and widely loved, manager of the Windsor brand. That was true despite several major strategic errors, including her belated public appearances after the deadly coal-waste landslide in Aberfan, Wales, in 1966, and Princess Diana’s death in 1997.
Charles, 73, is a quirky, sometimes prickly old man who cheated on Diana and whose record run as heir-apparent became a long-running national joke.
“He has to create a new identity for himself,” said Deborah Ancona, a professor of management and organization studies at MIT’s Sloan School.
Charles has accomplishments to build on: He’s been seriously involved in environmental issues for a long time. He raises a lot of money for charities. And he knows the inner workings of the Firm, including its finances, better than any of his family members.
But he must now engage in “sensemaking,” Ancona said, a process to determine how he can put his stamp on the business without undermining the monarchy’s reputation and public support.
“He is going to have to battle his ghosts to do that,” Ancona said, referring to what she laid out in a recent Harvard Business Review article as “fundamental behaviors and attitudes toward authority, mastery, and identity.” These behavioral patterns, developed during childhood, can emerge at work and potentially disrupt an executive’s performance.
In other words, Charles has to act like a king and CEO, not the dutiful son he’s been all his life. That’s easier said than done, especially since the rules of the monarchy are quite different than the rules of business.
Like any family business leader, he also will need to juggle the demands of multiple constituencies, according to Wing, the family business expert at Harvard.
These include the working royals, who represent the monarchy through public appearances. It’s bad for business when they quit, like Prince Harry and his wife, Meghan, did in 2020, amid charges of racism and cruelty toward Meghan. Some, like Prince Andrew, get demoted for bad behavior.
There are also nonroyal employees, including 490 who worked for the queen and 100 on Charles’s staff as Prince of Wales, some of whom could lose their jobs as he moves to Buckingham Palace from his residence known as Clarence House.
But most important are the Firm’s customers, primarily the 67.5 million people of the United Kingdom.
The business arrangement is essentially this: Family members perform their public duties, stay out of politics, and try to avoid doing anything that embarrasses themselves or the country. In return, they get a 25 percent cut of the income generated by the Crown Estate, an $18 billion real estate portfolio that is technically owned by the monarch, though its holdings can’t be sold.
That cut, which came to nearly $100 million last year, covers the family’s official expenses, including renovating Buckingham Palace.
Folding in separate security expenses, the UK government spent about $445 million in 2017 on the royal family, according to Republic, an organization that wants the monarchy abolished.
Defenders of the monarchy argue that is a bargain compared with the family’s contribution to the economy, mainly through tourism, which has been put as high as $2.7 billion a year prior to the pandemic.
Even so, without solid public support, the royal family could find its government payments cut or even eliminated. To be sure, they wouldn’t have to find regular jobs, because they have ample sources of income beyond the government-controlled Crown Estate.
There is the Duchy of Cornwall, a nearly 700-year-old estate, consisting mainly of agricultural properties, valued at more than $1.2 billion; its profits fund the personal and official expenses of whoever is the Prince of Wales. Prince William takes over that estate while Charles inherits another, the $930 million Duchy of Lancaster, which funds the monarch’s official and private spending.
Meanwhile, Forbes estimated that the family-owned Buckingham Palace is valued at almost $5 billion, while the queen had $500 million in other personal assets.
As Elizabeth’s elaborate funeral arrangements underscore, tradition is fundamental to the monarchy. But the royal family must also adapt to the times.
The Firm arguably could use a more youthful, modern CEO. But would Charles dare to cede control, say in five years, to William?
That would be a tough decision, given how long he waited to become king — and how his mother was revered for her dedication to lifelong service.
“I think continuity is very important,” Elizabeth said in a BBC documentary marking her 40th anniversary as queen. “It’s a job for life.”
That’s a ghost Charles will have to confront as king, chief executive, and chief evangelist for an ancient brand.