Jacob Rothschild inherited a single inkstand when his father Victor died. He may have been born into Europe’s most famous banking dynasty but it became abundantly clear after his parents’ divorce that he would have to make his way in the City of London on his own merit.
Jacob was brought up by his mother, but regular visits to his father brought home to him the disparity between being comfortable and truly wealthy. He set his sights on the latter and determined to use it as a force for good, which he managed to achieve as a noted philanthropist to the arts.
Tall, with a long oval face, high forehead and arched, hawk-like eyes, Rothschild — who built up RIT Capital Partners, one of Britain’s biggest investment trusts — said: “For a lot of my life I lived without luxury. My father was a scientist and my mother never lived in great luxury. It was only when I inherited money that I started to live more luxuriously. And I’ve always worked a lot.”
A cerebral man rarely given to raising his deep, resonant voice, he was strong-willed and when he said, “If you would like me to do it, just ask me,” the menacing understatement meant the task was urgent. Patience was not high among his virtues. He could hardly be otherwise as he helped to reinvigorate the family bank as a brilliant if idiosyncratic young strategist at NM Rothschild from the early 1960s. A banker who knew him well said: “He was a combination of long-range thinker and opportunist.”
Yet the shadow of his father still loomed and in 1976 Jacob was prevented from becoming chairman of NM Rothschild (NMR), the London arm of the family’s international banking network.
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Turning his attention to investing instead, Rothschild co-founded J Rothschild Assurance (later St James’s Place), the FTSE 100 group, and chaired RIT for more than 30 years. When he took over RIT it was capitalised at £5 million; by the time he stood down in 2019 it was capitalised at over £3 billion and had 15,000 shareholders.
His other great passion was for the arts. His friend and one-time business partner Sir James Goldsmith (obituary, July 21, 1997) said of him: “It depends which day it is. On one, Jacob is an excellent banker, the next he is absorbed by art and heritage. He has been torn between the two strands all his life.”
After joining NMR in his twenties, Jacob “earned his chops” by financing a transalpine pipeline in 1963. Ten years later he structured the deal for Grand Metropolitan, a hotel company, to buy the Watney Mann brewing group, then the UK’s biggest takeover. At his orchestration the bank also entered the increasingly lucrative eurobond and eurodollar market.
He wanted to transform NMR from a traditional merchant bank to what he called a “bank of brains” with creative thinking and bolder dealmaking. His ambitious vision led him to try to unite the French, Swiss and English branches of the Rothschild banks. None of this went down well with older relatives. When the NMR chairmanship fell vacant in 1976, Victor spurned Jacob for his cousin, Evelyn.
Jacob’s consolation prize was to run Rothschild Investment Trust, a small family firm. Instead of passively buying shares, he wanted to finance businesses and help manage them. His model of allowing retail shareholders access to listed and unlisted opportunities through a listed investment trust worked brilliantly. In 1979 he bought Clifton Nurseries, a west London garden centre. Within five years the trust had grown tenfold.
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His cousin Evelyn grew increasingly fearful of a rival firm evolving within NMR and ordered him not to engage in banking anywhere under the Rothschild name.
Jacob sold his 11 per cent stake in NMR, moved office from the City of London to St James’s Place in Green Park and renamed the investment trust RIT. He was allowed to use “J Rothschild” as a business name, but it marked a painful split which took years to heal. “A sad corporate divorce”, Jacob called it.
Now he was free to give full vent to his idiosyncratic talents, belying his outwardly languid style with aggressive deals. He bought into Asian plantations, Paris property, the Paypoint electronic payment system, The Economist newspaper group, Coats Viyella, a textiles firm, the Getty Images picture library and the New York art dealer Sotheby Parke Bernet. “I get infectious enthusiasms,” he said.
In 1983 he bought the Charterhouse merchant bank, calling the combined group Charterhouse J Rothschild, with the vision of creating a US-style conglomerate in financial services. To that end he also tried to merge with Hambro Life Assurance, run by his friend Sir Mark Weinberg. The deal foundered on the two men’s unyielding egos, although they managed to remain friends.
A year later he dismantled his dream. He accepted a bid from Royal Bank of Scotland for Charterhouse, then sold RIT’s interest in a stockbroker, Kitcat and Aitken.
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On January 19, 1986, Rothschild bumped into Ernest Saunders, the ambitious chairman of the Guinness drinks company, in St James’s Square. Saunders was emerging from the head office of Distillers, a crusty old Scottish whisky, gin and vodka group. The Guinness chairman wanted to take over Distillers, and asked Rothschild to help.
Rothschild bought millions of Guinness shares, which helped to maintain the value of the Guinness bid for Distillers. If that had been the purpose of those purchases, they would have been illegal. But, unlike the others involved, Rothschild took no payment for his actions. In 1997 Department of Trade and Industry inspectors accepted he had bought the shares for investment purposes.
In 1989 Goldsmith persuaded Rothschild to join him and the Australian tycoon Kerry Packer in an audacious £13 billion bid for BAT Industries, which owned Eagle Star insurance as well as many leading cigarette brands, including Pall Mall, Lucky Strike, Dunhill and Benson & Hedges.
Goldsmith and Rothschild had nothing like that amount of money, but they hoped their reputations would encourage banks to lend and investors to buy securities carrying high rates of interest, known as junk bonds.
Their plan was to sell BAT’s operations for more than they paid. But US regulatory authorities would not approve the change of ownership in BAT’s American insurance operations, and investors would not pay enough for the bonds. Finally, the BAT management aped the bidders’ plan and sold large parts of the group. Goldsmith and Rothschild retreated.
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Rothschild turned his back on such dramatic contests. “I dislike the maverick dealmaking label very much,” he said in 1994.
By then he had finally inherited a slice of the family fortune, his cousin Dorothy “Dollie” de Rothschild having left him more than £90 million in 1989, in what was then Britain’s biggest legacy. It enabled him to spread wealth, support charities and indulge his refined tastes in art and wine. “I read [art] catalogues like others read comics,” he said.
At the prompting of Sir Isaiah Berlin, Rothschild had been chairman of the National Gallery trustees since 1985 and earned royal gratitude by defusing the row over the gallery’s eastern extension, in the corner of Trafalgar Square. Prince Charles had called the original high-tech design by Ahrends Burton Koralek (ABK) “a monstrous carbuncle on the face of a much-loved and elegant friend”.
Rothschild commissioned Robert Venturi and Denise Scott Brown to draw up the softer, postmodern alternative that was built in 1991. He used his connections in the business world for the benefit of the arts, persuading Lord Sainsbury and his two brothers to fund the £30 million National Gallery extension and securing a £50 million donation from John Paul Getty. Rothschild himself paid for the restoration of the central hall of the gallery.
He also backed several of the prince’s charities and would later be appointed Commander of the Royal Victorian Order for services to the Duchy of Cornwall.
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Steadily increasing his commitment to arts administration, at the behest of John Major, then the prime minister, Rothschild oversaw the National Heritage Memorial Fund from 1992 and the Heritage Lottery fund from 1995. He used Heritage Fund money to renovate Somerset House, on the Thames Embankment, developing a public gallery to house the Gilbert Collection of 17 galleries of objets d’arts and a gallery of Russian art from the Hermitage collection in St Petersburg. By doing so he ensured the long-term future of the Courtauld Institute of Art, and opened its neoclassical courtyard to the public, where children ice skate in winter and play in the fountains in the summer.
Rothschild was knighted for services to the arts in 1998 and four years later appointed to the Order of Merit.
Numbering among his friends Mick Jagger and Nicole Kidman, who called him “fossil”, Rothschild remained a man of contradictions. He might open a can of beans to make his own breakfast, but have his tea served by a butler on bone china. The easyJet crowd at Corfu airport might not have noticed the slim, tanned, elderly man in their departure lounge, sitting alone, dressed slightly more smartly than the usual budget traveller. While they had mostly been staying in hotels and motels, he had been driven from his 30-acre estate, with a marble enclosed pool, artificial waterfalls and a spectacular sea view.
Nathaniel Charles Jacob Rothschild was born in 1936, in Merton Hall, Cambridge, where his father, Victor, the 3rd Baron Rothschild, was an academic. The peerage had been created in 1885 for Victor’s grandfather, “Natty” Rothschild, a hugely influential figure in political and financial circles. There was also a baronetcy dating from 1847.
Barbara (née Hutchinson), his mother, was an artist who had been brought up in the 1920s Bloomsbury set. After his parents’ bitter divorce, Victor hated anything or anyone that reminded him of his failed first marriage, including the three children of that union, Jacob and his sisters Sarah and Miranda.
At Eton Jacob was good academically, liked history, had no artistic talent and played cricket, but was a loner. “I was an awkward, difficult child,” he said of the diffidence that was the result of his father’s bullying. He also suffered from a bout of polio. However, he took to Oxford, where he obtained a first-class history degree at Christ Church, tutored by the distinguished historian Hugh Trevor-Roper (later Lord Dacre of Glanton).
Isaiah Berlin invited him to be a fellow of All Souls, but he decided to join the family bank, reasoning, “I would advance quickly as a member of the family, so why not?”
After Oxford he spent two years’ National Service in the Life Guards, then moved around the City: a year at Cooper Brothers, the accountants; a few months at Morgan Stanley, an investment bank; and a year at Barro Equities under Hermann Robinow. “He was a brilliant man. Most of what I learnt came from him,” said Rothschild.
In 1963 he began at NMR. At about the same time he was invited by a mutual friend to lunch with Sir Philip Dunn, an Anglo-Canadian businessman and landowner. Far from immune to female charms, he was introduced to Dunn’s daughter, Serena, and they married within a few months.
Serena, whose sister is the playwright and novelist Nell Dunn, owned racehorses. She died in 2019 and Rothschild is survived by their four children: Hannah is a film-maker and philanthropist who succeeded her father as chair of the National Gallery trustees — she is also a director of RIT and will now oversee the family’s charities; Beth is a professional garden designer; Emily trains dressage horses; and Nathaniel is a financier and investor who succeeds his father as 5th Baron and 6th baronet.
As a lover of history Rothschild was keenly aware of his family’s heritage as the founders of the modern banking system and effective banker to the British government in the 19th century. He was passionate about preserving some of the spoils of that wealth for the nation.
As such, in 1986 he took over the Rothschild Foundation, which runs Waddesdon Manor, the late-19th-century family estate in Buckinghamshire that was bequeathed to the National Trust by his cousin James in 1957.
“The founder of our family lived in the Frankfurt ghetto in a large room with 17 other people,” Rothschild said of his forebear, Mayer Amschel Rothschild, whose son Nathan Mayer Rothschild would found the house of Rothschild in Britain in the early 19th century. “In the first half of the 19th century the family made lots of money. They spent the second half of the 19th century spending it. They built 44 houses, collected like mad, bought lots of land, but then came the 20th century, two world wars and high taxation. Of those 44 houses only one remains.”
Rothschild was determined to make it count, overseeing and funding a painstaking restoration of the property, which contains 25,000 works of art and is visited by some 450,000 people a year. His daughter Beth helped to redesign the gardens. He also powered the estate with low-carbon energy solutions and installed progressive farming practices on the surrounding land.
Another historic building close to his heart was Spencer House, near his office in Green Park. In 1986 his investment firm RIT took a 96-year lease on the building from Princess Diana’s family. Rothschild developed an office on the site, which funded a £16 million restoration project to return the state rooms and garden to their original appearance. “Every day I was seeing this great house being maltreated, and I thought it was appalling,” he recalled. “But it did give me a reason to telephone Diana and say, ‘I’m thinking of painting the walls this colour, would you like to come and look?’ I liked her very much.” The Princess of Wales, who became a good friend of his, called the project the “most exciting” present of her life.
He gradually bought most of St James’s Place, which became known by locals as St Jacob’s Place.
His cousin Dorothy also bequeathed him Yad Hanadiv, the Rothschild charity in Israel. It has built the Knesset, the Supreme Court and a national library, and funded many educational projects for Jews and Arabs. Rothschild himself was proud of his Jewish identity and was associated with the New West End synagogue in Bayswater, founded by the family, and the Reform synagogue in Marble Arch.
During the pandemic his Rothschild Foundation, based at Waddesdon Manor, established a £440,000 Covid support fund. A workaholic, he had retired as chairman of RIT only in 2019, and remained active in the management of the Waddesdon estate to the end.
At times Lord Rothschild’s perspective might have been liable to turn 19th-century Rothschilds in their graves. In 2012, at the height of the Occupy movement’s anti-bank sit-ins, he said: “I have a lot of sympathy with people who protest about excesses in the world of finance. The banking system as a whole has had a crippling effect in a number of areas throughout the world.”
Lord Rothschild OM GBE CVO, banker, investor, philanthropist and art lover, was born on April 29, 1936. He died after a short illness on February 26, 2024, aged 87