Corporate art collections go under the hammer to raise cash

Companies are preparing for a post-crisis era with less office space in which to impress clients and staff

Cool Edge by Bridget Riley

In a 2012 book about corporate art collections, Angeline Mayhead, who was responsible for British Airways’ lounge design for almost three decades, described the company’s collection as “enduring and sustainable”.

That was until a global pandemic grounded the airline’s entire fleet, forcing it to axe 12,000 jobs and dispose of some of its famous works to raise extra cash. 

Corporates selling their art collections is not a new phenomenon, but the pandemic has hastened the trend, with major collectors including Deutsche Bank disposing of thousands of pieces to prepare for a post-crisis era with less office space in which to impress clients and staff. 

“The disposal of corporate collections is something that we’ve been helping clients do for the last decade, but the pandemic has certainly accelerated that trend,” says Patrick McCrae, chief executive of arts consultancy Artiq. 

“More businesses are looking at where they can extract latent value in assets, which is what has encouraged bigger collectors to dispose of their collections.”

Over the summer, BA sold 17 pieces that had previously decorated its executive lounges, including works by Bridget Riley and Damien Hirst, for £2.2m through Sotheby’s. Deutsche, which holds more than 55,000 works in total, followed suit by announcing plans to dispose of 4,000 pieces over the next few years. 

Stainless steel art by Anish Kapoor titled ‘Turning the World Upside Down’ and one of Damian Hirst’s renowned “spot paintings” in the reception of Deutsche Bank's London office Credit: Deutsche Bank Art Collection

The companies have different reasons for selling parts of their collections, however. Deutsche says the move was already in the pipeline pre-pandemic and it's a result of the bank reducing office space and therefore having fewer walls on which to present works. 

Friedhelm Hütte, head of arts at the bank, told Forbes last month that its collection had always centred around the idea of “art at the workplace”, and that fewer branches would lower the number of works it owns. 

BA, on the other hand, says the disposals were part of its efforts to “preserve funds and protect jobs”. But considering the huge losses airlines such as BA have suffered in recent months – its parent company IAG posted a £1.2bn quarterly loss last month – the sales have a negligible impact on its balance sheet. 

McCrae describes the money earned through disposals as “a drop in the ocean”: “They’re raising a bit of cash that might help keep the lights on for three hours.”

‘Cool Edge’ by Bridget Riley was one of seventeen works of art BA sold over the summer Credit: Anthony Harvey/Shutterstock

Others believe that disposing of corporate collections during a downturn is merely part of a savvy public relations strategy. 

Alaistair Hicks, a former longstanding senior curator at Deutsche, says holding on to expensive pieces at a time when staff are being made redundant “doesn’t fill people with a sense of their own value”.

“Ultimately, art collections are not very high up on the priorities list of companies.”

Changing tastes and the evolution of ideas surrounding corporate social responsibility are also having an impact on companies’ collections.

When Deutsche first started collecting works in the late 1970s and early 1980s, Hicks says its philosophy was centred around “breaking down the ivory tower mentality of the office” and engaging staff and clients with the outside world. 

He adds that the bank wanted to be the “antidote” to rivals such as New York-based Chase, which bought “fabulous but big, splashy works… very much in the tradition of American spending”. 

In order to do this, Deutsche almost exclusively bought works on paper, which are much cheaper than other materials, Hicks explains. This allowed the lender to display numerous, affordable pieces while also staying true to the most important aspect of the philosophy: constant change and evolution. 

A painting by Gerhard Richter in the lobby of Deutsche Bank's New York headquarters Credit: Eyevine/Redux

Hicks says: “Unless you’re bringing new ideas in from new artists, you’re actually failing the concept [behind the strategy].” McCrae, whose business focuses on leasing collections to firms rather than selling, agrees. 

He adds that a print bought in the 1990s, sitting on the wall for 30 years, is not going to be as “powerful” as a contemporary artist creating a work that tells the current story of a company. 

McCrae cites a client, Investec, a South African bank with a major London premises, that commissions UK and South African artists but changes its collections every six months, as an example of the benefits of renting works. 

But Hicks is critical of companies who lease collections rather than purchase them, describing the process as “a transitional stage where people are not believing in what they’re doing... it’s showing no sense of direction at all”. 

Environmental, social and governance concerns are also changing corporate collections, with many firms using art to drive equality and diversity campaigns. 

Fewer artworks may adorn company offices as Covid-19 means they are left largely empty Credit: Deutsche Bank Art Collection

For example, City law firm Mayer Brown’s collection is almost entirely created by female and non-binary artists, which was done to coincide with international women’s day.

Meanwhile Italian bank Unicredit, which disposed of some of its collection in September, says it wants to “replace the masterpieces sold with works of young and emerging artists”.

But the pandemic threatens the close and lucrative relationship between the corporate world and the arts, as companies sell off both office space and paintings.

McCrae says corporate patronage of the arts is “so vital”. And while the crisis is unlikely to kill off investment entirely, penny pinching, empty offices and weaker demand could spell a prolonged downturn for the art industry.