TIAMSA Blog: Art and Offshore Finance: Aesthetic Value Reshaped, by Mathew Henrickson

The influence of offshore financial practices, used to own and trade art, and their effect on the perception of art as an aesthetic object is an under-researched yet highly significant area of Art Market Studies. The field shines a light on how sophisticated financial engineering and the art market converge. A remarkable effect of such a convergence is how the relationship between financial and aesthetic value can become quickly skewed.

            The Panama Papers data leak highlighted such a problem where examples of many marquee names (from Leonardo da Vinci to Mark Rothko) were utilised as stores or conduits through which to transmit wealth.  The Panama Papers was an unprecedented leak of documentation linked to the veiled dealings of secretive offshore entities and a unique opportunity to further research into a highly secretive part of the art market. The higher profile cases related to the disputed ownership of the 1918 Modigliani portrait Seated Man with a Cane, the manufactured investment opportunity linked to the Ganz Picasso collection and details of how offshore ownership of art was utilised by Dmitry Rybolovlev as an innovative tool in an estate planning strategy.

Art in a commercial context is nothing new in art historical discourse but there is an absence of critical thought given to this particular area and its potential to influence more generalised views of art as an aesthetic object. The case for research and further study is strong yet the academic backdrop is fragmented. Perhaps the main reasons for a lack of research into this area have been problems of access and a protectionist stance by certain areas of the art market that, for various legitimate reasons, privilege confidentiality and secrecy.

Due to such opacity, research into such practices and their potential influences has proven difficult . While the influences are too many and complex to explore in a short blog post, by simply looking to media coverage of the Panama Papers cases and sensationalised emphasis on the financial aspects of such case studies, we see how art quickly morphs into a financial asset rather than anything creative or aesthetically meaningful.

Suchcoverage has seldom focussed on the aesthetic backdrop or critical reception that underpins the often-lofty prices paid for artworks. In the case studies presented in the data leak, it is clear that commercial and financial value are supported, and often buoyed, by positive aesthetic judgement. However, what also remains clear is how the relationship between aesthetics and economic value, linked to art, can be distorted through the involvement of complex and innovative offshore financial practices. Aesthetic and financial value will continue to interact in a commercial setting; and, in a general sense, aesthetics and financial value will exist in some balance, acting in tandem in a wide range of commercial contexts. However, art ownership through complex, opaque and often tax efficient offshore structures so often leads to a focus on the exploitable financial benefits of high-end artwork.

The leak offers an opportunity to reframe the debate on the commoditisation (or monetisation) of art and to expose how art can become the subject of financial discourse rather than an object of aesthetic significance. Art’s aesthetic and financial value will forever continue to be highly complex areas of historical and philosophical discourse. However,  the leak exposes the development of a conflict, inherent to the high-end art market, in which aesthetic merit can easily be eclipsed by the more favoured economic utility of highly lauded marquee canvasses.

Mathew Henrickson, Frankfurt, April 2019

Mathew Henrickson has over 15 years’ experience working in the financial services sector and in 2019 completed an MA (History of Art) at the University of Buckingham following an innovative research project on the convergence of offshore finance and the art market . Mathew’s particular research interests centre on the high end art market and on art as a store of wealth and its effect on the perception of art as a creative object. Prior to his MA, Mathew graduated in 2003 with a BA in French and Hispanic Studies from the University of Liverpool. 

For queries and comments, please contact the author at  panam_art@outlook.com