Legitimate Wealth? How Wealthy Business Owners are Portrayed in the Press

The literature on wealth and inheritance taxation suggests that the source of wealth is central when it comes to evaluating whether or not someone is deservingly rich (see also Rowlingson & Connor, 2011 for a similar categorization). Bastani and Waldenström (2021), for example, show that people become much more favourable towards redistributive policies when they know about the share of inherited wealth in society. Hence, if people believe wealth is mainly self-accumulated, they show stronger disapproval of wealth redistribution than if they see it as mere luck. In a similar vein, Sachweh and Eicher (2018) have shown for Germany that individuals tend to be less in favour of taxing high levels of wealth when they perceive this wealth to be the outcome of work rather than inheritance, marriage, or winning the lottery. Accordingly, the question of whether or not people are deservingly rich is closely linked to question how rich people have accumulated their wealth (i.a. merit, hard work, effort, and risk-taking Rowlingson & Connor, 2011; Sachweh, 2012). In addition, accumulating wealth through business success or entrepreneurial innovation can be seen as another meritocratic framing strategy vis-à-vis the “deservingly wealthy” (Bröckling, 2016; Kantola & Kuusela, 2019; Waitkus & Groh-Samberg, 2018). In contrast, undeserved—and therefore less legitimate—wealth is acquired through sources that are perceived as non-meritocratic, such as inheritance, speculation, or luck (Rowlingson & Connor, 2011; see also Kreidl, 2000). Hence, our first guiding frame for the coding of press articles is the source of wealth—whether this be an inheritance, returns on investments, or entrepreneurship and work.

The literature on the legitimacy of richness and wealth further suggests that whether or not an individual’s wealth will be perceived by others as legitimate depends on the use of wealth.² For example, one’s existing wealth can be used to further the accumulation of capital, mainly in the form of capital returns on investments. Research has shown that this use of wealth may accompany more negative evaluations of profit-seeking (Ragusa, 2015; Rowlingson & Connor, 2011). The profit-seeking motive can also have a positive connotation—for example, when it is discussed in the context of job creation or investing in new technologies. This could be especially relevant to the German case, where the Mittelstand (midsized companies) has been framed as the backbone of the German social market economy (for example Mau, 2012; see more on this below).

Wealthy people further employ wealth in philanthropic activities to legitimize their riches. A study by Ragusa shows that people tend to be less enthusiastic about taxing inheritance when the wealthy use their fortunes for the common good. In contrast, they are much more in favour of taxation when they assume the wealthy use it for their own profits (Ragusa, 2015). Therefore, whether wealth is used for generating more profit (see above), is invested into the creation of jobs or goes into philanthropic activities matters, since philanthropic activities by foundations or wealthy individuals are largely presented as being for the common good (Glucksberg & Russell-Prywata, 2020; Sklair & Glucksberg, 2020).

Another way wealthy people use and employ the wealth is in the political sphere. Although wealthy business owners in Germany seldom run for office or use their wealth for political activities, they do  use party donations to indicate ideological alignment and political orientations, though to a much lower degree than in liberal economies (McMenamin, 2012). Nonetheless, they tend to favour centre-right parties (CDU/CSU and FDP, see also Polk, 2020). Although donations across the political spectrum have increased, family business owners in particular still stick to their political ideologies (Goerres & Höpner, 2014). This is relevant, as the policy preferences of the wealthy differ from those of the middle and working classes (Page et al., 2013), and politics tend to be more responsive to their interests (Bartels, 2016; Elsässer et al., 2021). In sum, our second frame focuses on the use of wealth and how the media covers the different ways of using one’s wealth: for sheer profit-seeking, philanthropic reasons, tax evasion, or for political lobbying purposes.

A third set of arguments that we have identified in the literature focuses to the moral evaluation of the personal conduct of the wealthy (Hecht, 2021; Kantola & Kuusela, 2019; Lamont, 1992; Rowlingson & Connor, 2011; Sherman, 2019).³ Lifestyles and consumption patterns have always served as grounds for elite distinction and legitimization practices (Bourdieu, 1984; Elias, 1978; Veblen, 2017). In a recent study, Sherman finds that when it comes to consumption, wealthy New Yorkers define their expenditures as reasonable and basic, and draw a moral boundary between themselves and other elites whom they perceive to be materialistic, pretentious, greedy, or shallow (Sherman, 2018; see also Schimpfössl, 2018). Consumption choices, they imply, should indicate normality and ordinariness rather than the ostentatiousness that Veblen (2017) describes for the nouveaux riches (see also Bourdieu, 1984; Jaworski & Thurlow, 2017; Sherman, 2018). In the same vein, researchers find that wealthy business owners construct identities based on hard work, persistence, and normality in order to legitimize their privileged positions (Kuusela, 2018). Thus, in their study of female business owners’ autobiographies, Adamson and Johansson (2020) identify a downplaying of class and wealth differences as these owners stress their ordinariness and the universality of gender struggles. This self-portrait has been reinforced by TV media, who portray the wealthy as particularly resilient, hard-working, and psychological superior in comparison with ordinary people (Carr et al., 2021). Of course, this emphasis on ordinary lifestyles is a somewhat recent phenomenon (Friedman & Reeves, 2020). Over the past two centuries, the focus of elite lifestyles has shifted from aristocratic activities such as hunting, polo, and sailing (19th-century), to emerging “high” cultural forms such as theatre, art, ballet, and classical music (twentieth century), to today’s core interest in spending time with family, friends, and pets.

Friedmann and Reeves argue that this kind of lifestyle shift occurs when emergent groups challenge elites’ position in society. In times of severe economic inequality, the move towards an ordinary lifestyle is a reaction to popular attitudes, as “they [elites] face increasing suspicion from wider publics that they lack prosocial motives and, in turn, authenticity and moral character” (Friedman & Reeves, 2020, p. 325). By signalling the ordinariness of their lifestyles—through a focus on family orientation and simple hobbies—elites try to overcome this authenticity gap (ibid.).

Against this background, we would expect public debate to reflect on the personalities of these elites—to possibly highlight the strong family orientation among German business owners and/or to report either on their extremely lavish or (in the opposite vein) surprisingly ascetic consumer behaviour. In sum, our third frame focuses on how the media moral evaluates the personal conduct of our chosen study group, focusing on consumption patterns (is elite consumer behaviour restrained or ostentatious?), family dynamics, and general descriptions of the (moral) character of wealthy businesspeople.

Overall, we use these three lines of research on the legitimacy of wealth and inequality—sources of wealth, usages of wealth, and the moral evaluation of their personal conduct—as guiding themes for our empirical analysis of frames.⁴ The next section gives more context and information on our case and presents our analytic approach.

The German capitalist market economy after World War II was mainly based on companies and family business embedded in multiple sets of rules and regulations between labour and capital interests (Streeck, 1997). Most companies were privately held, and only a small part of the productive capital was traded on the stock market (Dunlavy & Welskopp, 2007). Therefore, shareholding was highly concentrated and company shares seldom changed hands (Colli & Rose, 2008; Streeck, 1997, p. 241). These historical developments continue to shape the current economic structure in Germany, where the largest public and private companies are still associated with family businesses. Although business owners at the top of the German rich lists (and therefore also sit at the top of its wealth distribution), research on business owners mainly addresses intergenerational transmission and family ties (for example Berghoff, 2006; Stamm, 2016; Stamm et al., 2011) or the specific role of Mittelstand⁵ (family) business as the backbone of German capitalism (Berghoff, 2006; Kohl & Ergen, 2021; Streeck, 1997). Research on business owners and their wealth in Germany is particularly rare (Hartmann, 2000; Zellweger & Kammerlander, 2015); however, there is a strong association between the rise in wealth inequality since the 1990s and the growing business wealth at the top of the distribution (Albers et al., 2020).

To explore the frames for legitimacy, we use Manager Magazin’s annual German Rich List (similar to the Forbes list). We restrict our research to the five-year period (2014–2018) following the global recession—a time when the Eurozone crisis had nearly ended, but the COVID-19 pandemic had not yet begun. Further, we only study business owners who make it to the top ten more than once, which means (we assume) that they are publicly known. Following this strategy, we identify 16 business owners who either run their own businesses (the majority), or who co-own and run several companies in connection with one key brand (see overview in Table 1).

These companies are deeply enmeshed in Germany’s export-driven economy and strongly profit from economic globalization (Lane, 2000; Streeck, 1997). They include car companies and their suppliers (Quandt/Klatten, Schaeffler, Porsche, Thiele), supermarket chains and other food supply and production companies (Schwarz, K. Albrecht and T. Albrecht, Oetker, Reimann, Herz), as well as firms from other industries such as logistics (Kühne), tools (Würth), trade/services (Otto), and software (Hopp, Plattner). Some of them have profited massively from expropriation, forced labour, and/or supplying the Wehrmacht between 1933–1945 (Dean, 2008; Frei & Schanetzky, 2010; Windolf & Marx, 2022).⁶ While we are aware that not all of Germany’s wealth elite inherited their riches, only a small fraction of the families we studied had built up their own wealth (Schwarz, Thiele, Plattner, Hopp).

Based on this list, we searched the Factiva database for relevant articles, using the name of the family, affiliated companies, and either the German term “reich/Reichtum” (rich/richness) or “Vermögen” (wealth) in our keyword query.⁷ We selected a variety of media outlets, capturing different political–ideological orientations as well as print media types (see Table 4).

Following this methodology, we retrieved 899 articles for our research period.⁸ Our sample includes three daily quality newspapers (Süddeutsche Zeitung, Welt and Welt am Sonntag, taz), one economic daily newspaper (Handelsblatt), a weekly newspaper (Die Zeit), three weekly magazines (Spiegel, Stern, Focus), and a tabloid (Bild). This selection enabled us to draw the sample from various different types of media outlets with different distribution schedules (daily/weekly), all of which had a broad circulation and large readership (IVW, 2019).

Second, we developed our codebook alongside a pretest with a small sample of texts and that guides our analysis (see Appendix Tables 3 and 10). To test the viability of our initial themes and to identify new sub-themes, we developed an initial codebook using a deductive-inductive coding technique (see Table 3). We then revised this codebook, defining the coding categories to be used during the final coding of our sample. In total, we coded 641 (71.3%) of the 899 media articles selected (see Table 4). The number of coded articles varies by media outlet and family (see Table 5). For example, we only retrieved four articles for Liebherr, which is why we chose not to interpret the findings for this business owner. By contrast, our sample extensively covers Susanne Klatten and Stefan Quandt (main shareholders of BMW) or Wolfgang Porsche (a Porsche shareholder). The highest number of selected and coded articles in our sample came from the economic newspaper Handelsblatt and the liberal-left newspaper SZ, whereas less than half of them came from the tabloid press (Bild).⁹

Our methodological approach to these articles was guided by frame analysis. Frame analysis is a technique that enables researchers to examine text in a structured and transparent manner (David & Baden, 2017; Entman, 1993; Snow, 2004). Framing means “to select some aspects of a perceived reality and make them more salient in a communicating text, in such a way as to promote a particular problem definition, causal interpretation, moral evaluation, and/or treatment recommendation for the item described” (Entman, 1993, p. 52). The process of selection and salience is crucial to understanding media coverage of certain issues and is used as a heuristic to grasp the meaning-making process in texts. Frames structure public debate by selecting and highlighting certain aspects of those debates, influencing how political and societal problems are perceived, and thus potentially mobilizing the public (Entman, 2007; Snow, 2004; Wallaschek, 2020). As De Vreese (2005, p. 52) notes, “frames may contribute to shaping social level processes such as political socialization, decision-making, and collective actions”. Which frames prevail in the media—and how they are presented—shapes people’s understanding of the issues, and influences their support or rejection of them (Ferrara et al., 2021).

To apply the frames approach to our study, we first manually coded manifest frames in the selected media articles. We then built on these findings by describing the manifest frames before applying latent class analysis (LCA). This method helped us to uncover latent frames in our data. As a probabilistic type of cluster analysis, LCA enables researchers to identify specific constellations for categorical data. It involves structural equation modelling and requires extensive interpretation of the results. Formally, one can obtain the best solution under this method when different test statistics—such as those produced by the Lo, Mendell, and Rubin test—are significant, and when the information criteria reach the minimum (Lo et al., 2001; Nylund et al., 2007; Vermunt & Magidson, 2004), although the result must also be theoretically meaningful. We used nine indicators for the LCA: (1) inequality, (2) source: inheritance, (3) source: investment, (4) source: entrepreneurship, (5) usage: philanthropy, (6) usage: profit, (7) moral: positive personal evaluation, (8) moral: negative personal evaluation, (9) moral: family orientation. We excluded less frequent references (i.e. those that appeared in less than 10% of all valid articles; see Table 2).

In general, the topic of inequality received scant attention in our media sample. About 35% of the sampled articles mention that the owner’s family in question is richer or wealthier than other families or individuals, either in Germany or around the globe. However, the number of references to inequality varies by family. For some families (Würth, Quandt/Klatten, Schaeffler, and Reimann), we find frequent references to this topic, whereas for others (Otto, Porsche, Oetker, Herz), it hardly makes news.

As we have already noted, how one describes the sources of a person’s wealth can legitimize or delegitimize its accumulation and the resultant inequality. People tend to accept the legitimacy of wealth if it is portrayed as the result of hard work, entrepreneurship, or merit—which is not the case if it comes from inheritance, luck, marriage, or investment (Rowlingson & Connor, 2011; Sachweh & Eicher, 2018). In our sample, most business owners are predominantly described as entrepreneurs; thus for eleven out of our 16 families, this angle appears more frequently than those of investment or inheritance. This is hardly surprising, given that the name of the company was one of our queried keywords. Nevertheless, while almost all the owners in our data have heirs in their ranks (see Table 1), this fact is only mentioned in about a third of all articles (Table 2). Investment as a source of wealth was referenced for all the business owners in our data, but more frequently for Kühne, Herz, Quandt/Klatten, Porsche and Thiele—the first four of which inherited large shares of their companies.

Regarding wealth usage, a quarter of our sampled articles mention philanthropic activities, with Otto scoring very high on this item (in 67% of the articles mentioning Michael Otto his philanthropic work in Hamburg, for example the co-financing of the Elbphilharmonie concert hall or a public art gallery, is noted), followed by Aldi-Süd (K. Albrecht) and Kühne. Another illustrative case of philanthropy depicted in the articles sampled was the Schwarz family foundation’s donation of 20 economics professorships to the Technical University Munich.

Philanthropic work was not relevant for other families (e.g. Reimann or Schaeffler), since they seem not engage (publicly) in such activities. By contrast, the profit-seeking motive comes up especially frequently in connection with the two Albrecht brothers, Thiele and Würth families. This may be due to their media depiction as success stories for new businesses, either during the German “Wirtschaftswunder” of the 1950s–60s  (in the cases of Albrecht and Würth) or following a series of economic challenges to their companies (in the case of Thiele). What is more, political engagement is hardly an issue in our sample. One exception is Kühne who is (alongside the state of Hamburg) one of the main shareholders of the German shipping company Hapag-Lloyd and has a financial engagement in the football club Hamburger SV. Otherwise, Quandt/Klatten are noticed when they donate to the German political parties CDU or FDP.

In contrast to our initial expectations, the sampled articles seldom mention tax evasion. We do find references to Kühne, Reimann, Quandt/Klatten, and Herz—owners who have transferred their business to their children in order to circumvent inheritance and capital taxation (Quandt/Klatten), or moved their headquarters to Switzerland, Austria, or Luxembourg to limit corporate taxes (Kühne, Reimann).

Table 2 also shows details on the moral evaluations of personal conduct that can be found in our sample. While the articles we selected presented relatively few such evaluations, articles that do include moral assessments appear slightly more inclined to give a positive evaluation in this regard (24% of all such articles) than a negative one (18%). While we did expect to find more positive characterization of companies as local Mittelstand firms (both of which are associated with being a “good capitalist”), we find this in only eight per cent of all articles, though this type of reference crops up more often for some (K. Albrecht, Otto, Schaeffler, and Thiele) than for others. The emphasis on family and family business was another element in the articles investigated (almost 18% of all articles). Here again, variation looms large and is particularly pronounced for K. Albrecht, Oetker, Porsche, and Thiele, with the first three experiencing tough and challenging intergenerational wealth- and power-transmission processes within their companies.

Lastly, consumption was less of an issue among the articles investigated. The few mentions we found on this topic focused on wealthy business owners’ extensive consumption and purchase of luxury goods, rather than their ascetic or restrained lifestyles. However, both consumption patterns receive predominantly positive framing. The articles portrayed high consumption as a personal reward for hard work, and low consumption as a signal of focused business ownership and a strict work ethic.

Overall, the descriptions show that the media coverage of the German business families in our sample rarely targets inequality, tends to discuss entrepreneurialism, has a slight tendency to view the personal conduct of those in this group as morally positive, and focuses much more on profit-seeking and philanthropy than on politics, taxes, and other issues. While no clear patterns emerge from these first descriptive results, we embark on a further task to uncover latent frames in the coded media articles.

The second step of our empirical analysis seeks to discover whether we can detect latent frames of press coverage on wealthy business owners. Using only indicators that occurred in more than ten per cent of our coded articles, we ran the LCA with nine indicators: (1) inequality, (2) source: inheritance, (3) source: investment, (4) source: entrepreneurship, (5) usage: philanthropy, (6) usage: profit, (7) moral: positive personal evaluation, (8) moral: negative personal evaluation, (9) moral: family orientation.

After a thorough investigation of different latent class solutions (see Table 6 and 7), we opted for the six-class solution (as it yielded the most favourable test statistics and the most meaningful results). The six latent classes offer a preliminary focus on different aspects of these owners and can therefore illuminate which manifest codes go together (see Fig. 1). We start with the largest latent frame to be found in our sample:

About 35% of all articles in our sample simply cite entrepreneurship as the source of wealth, nearly ignoring all other topics. Therefore, we label this latent frame “Simple Entrepreneurship”. Investment as a source of wealth and owner philanthropy are scarcely covered, and the topic of inheritance is not addressed at all. This latent frame seems to be the most exemplary one for media coverage of wealthy business owners. The reports mainly focus on the companies and their economic development and prospects, with less coverage of the individual owners or their families, although their wealth is mentioned (but not inequality, for that matter). This frame is most often associated with Hopp and Plattner, founders of the SAP software company and predominantly seen as successful entrepreneurs “made in Germany”; however, we also see it in connection with Schaeffler and Schwarz. This economic success story as entrepreneurs seems to be the foundation to justify their wealth.

The second largest frame, which we call “Positive for Profit”, covers 22% of all the sampled articles. This frame highlights the unequal distribution of wealth and is much more concerned with wealth as the result of investment and entrepreneurship, rather than inheritance. While the philanthropy occasionally crops up, thematically the topics of profit orientation and positive personal evaluation predominate. K. Albrecht, Kühne, Thiele, and Würth families are associated with this latent frame. These three companies (retail, automotive supplier, and tools) represent the core of German capitalism (Streeck, 1997) and they established strong economic positions in Germany before expanding their businesses to other countries. Led over decades by men who are occasionally described (positively) as patriarchs and perceived as hard-working, these companies often anticipated what is economically sensible (for instance, by “inventing the retail discounter” in the case of Aldi-Süd [K. Albrecht]).

The third largest frame (found in 20% of all articles) especially focuses on investment and a for-profit orientation (“Investment Profit Frame”). The families most often associated with this frame are Quandt/Klatten, Herz, and Porsche. Even though these families represent the car industry sector (Porsche and BMW)—an economic cornerstone of German capitalism—media coverage on them strongly focuses on their new financial investment strategies and role as company shareholders (or, in the case of Herz, their investment in new companies, thus diversifying the company’s portfolio). Such reports highlight the profitability of these companies as well as the profit orientation of their owners. An interesting side note is that these owners all represent the bleaker part of German capitalism: the Quandt and Porsche families, in particular, have profited substantially from the Nazi regime—a historical fact, that is rarely mentioned in the press articles we analysed.

We label the fourth latent frame the “Negative Family Business Frame” (found in about 12% of our sample), since it includes articles that almost completely ignore the topic of inequality while describing all sources of wealth to an almost comparable amount. Noteworthy about this latent frame is its especially frequent use of negative evaluations of personal conduct and strong focus on family orientation—the strongest of all the frames we analysed. Owners associated with this sort of coverage are Porsche and Oetker, whose families made headlines regarding their family disputes.

By contrast, our fifth frame (the “Inheritance-Inequality Frame”) focuses on source of inheritance while still including some references to economic inequality. While only seven per cent of all articles fall into this category, we find that this frame tends to be more frequent when used in connection with Quandt/Klatten, Reimann, and K. Albrecht (Aldi-Süd). It is the only frame for which the topic of inequality is problematized and given crucial importance. For example, Quandt and Klatten were regularly covered by the press when the matriarch Johanna Quandt died and it was revealed that her BMW company shares had already been transferred to her children using tax loopholes which enabled her to (largely) circumvent inheritance taxation. Inheritance was a frequent topic after the founder of the retailer Aldi-Süd, Karl Albrecht, died in 2014. Both Albrecht brothers established foundations to control assets and avoid company breakup due to inheritance disputes. Furthermore, many obituaries in the media not only framed Aldi as positive German capitalism success story, but also emphasized the personal wealth Karl Albrecht accumulated through his entrepreneurial innovations.

Our last and smallest latent class is characterized by a strong emphasis on inheritance and philanthropy, as well as moral evaluations of personal conduct. Therefore, we label this latent frame “Philanthropic Heirs”. While the personal evaluations are predominantly positive, for this frame we also find more negative evaluations of these families than in other frames. Since only four per cent of all articles fall into this category, only T. Albrecht and Otto are worth mentioning. In this regard—as we have already mentioned—Otto receives particularly strong coverage for his philanthropic engagement in Hamburg.

Overall, we find six different latent frames that cover and link distinct aspects. While only two of six latent frames (Positive for Profit, Inheritance Inequality) regularly mention inequality, the largest frame we found is mainly concerned with a simple description of entrepreneurial activity. We assume that this is partially the result of our sampling strategy, since we specifically aimed to find articles on business owners and their companies and thus also retrieved a huge chunk of economic news articles. Another highlight of our latent class analysis is that personal moral evaluations are hardly observable but do have the tendency to evaluate these families in a positive way. This concerns consumption but also philanthropic activities, work ethics, and other positively connotated characteristics. Overall, we interpret these findings as constituting a rather legitimizing debate on wealth of German business owners.