Drawing on interviews with 80 members of the Russian elite, Elisabeth Schimpfössl argues that these oligarchs have progressed to become a fully-fledged bourgeoisie class, exhibiting their own tastes and values, much like their French equivalents described by Pierre Bourdieu in his seminal 1979 work “Distinction”. (FT, 2019)
What was the main driver behind writing this book?
There is a very big topic in sociology—how the structure of society is reproduced, why the poor remain poor generation after generation, and how different resources are distributed. These topics are especially pertinent in Russia, where within a very short period of time wealth has become highly unevenly distributed, so much so that Credit Suisse contemplated inventing a separate category for the country in their 2014 Global Wealth Report. Despite this gaping divide with a stratospherically rich oligarchy at its top, there was no research that had scrutinized Russia’s rich from a sociological perspective.
How did you choose your interview subjects?
My main guide was the Forbes list. I particularly focused on those individuals who are actively involved in philanthropy.
This was especially evident when I first started writing my work, and it was difficult for me to negotiate interviews with rich people since they often passed judgment based on luxury brands. They evaluated me just based on the way I dressed, wondering whether it would be worth spending time on this girl. Sometimes they rejected my requests.
What were the main conclusions of the book? How did the profile of Russian businesspersons evolve over the last 30 years?
The Russian elite have undergone the same process that other wealthy figures have gone through in history and did so as far back as in the late nineteenth-century America. An important sociologist of that time was Thorstein Veblen who coined the term “conspicuous consumption”, a phenomenon he observed among newly wealthy people in Chicago. Similarly, the newly rich Russians too immersed into lavish lifestyles, often showing off their latest luxury purchases. As some of my interviewees recalled, this felt like being back on a playground as children and discovering all a sea of new toys, just that in their case it was yachts and supercars. Over time, this not only starts appearing dull and vulgar, but – just as in the case of late-nineteenth-century businessmen in the US, such as Rockefeller, Carnegie and Mellon, also rich Russians quickly started their quest for something with deeper meaning. First of all, it was important for them to emphasize how educated, cultured and sophisticated they were cultured. Philanthropic activities quickly followed suit.
What role does philanthropy play in their lives? Were you able to see a trend among the people who you interviewed?
There are people who are really involved in charity and there are a few who don’t do it at all. How there give depends a lot on their family backgrounds. Even though all of them were brought up as atheists in the Soviet Union, rich Russians from a Jewish background seem nevertheless somehow to have picked up the basic rules of giving as instructed in Judaism – that it is an obligation to give back and look after one’s community. Those philanthropists’ approach to giving tends to be very systematic, compared with those elites with a Russian background. For Russians, charity is much more an emotional and often sporadic thing, coming from a good heart. What unites all unites of them is an indestructible love for children! Julia Khodorova of CAF Russia published a study that shows that around 90% of charities founded by Russia’s elites are focused on the wellbeing of children.
How do these people choose the bankers, advisors, and consultants that they work with?
I have never looked at this question from an academic point of view, but what people tell me is that Russian businessmen tend to trust people from the same background. For example, Abramovich has a team that consists exclusively of people with a Jewish background. They might be keen on having some Western experts around, but the core team consists of people from the same cultural backgrounds.
Thank you very much! We look forward to seeing you at the Adam Smith Summit in April!
Elisabeth Schimpfössl as well as Julia Khodorova of CAF Russia mentioned in this interview will be speaking at the forthcoming Adam Smith Conference “Wealth Management & Private Banking: Russia & CIS” on the 10-11 of April 2019 in Moscow
By Vadim Kudruk, Taissia Chinina-Kelly
For Adam Smith Conferences