Royal Male: Britain's Prince Andrew, Duke of York, on November 20 2019. Picture: AFP/JOHN THYS
Royal Male: Britain's Prince Andrew, Duke of York, on November 20 2019. Picture: AFP/JOHN THYS

Can royalty be fired? The UK’s Prince Andrew’s resignation from public duties following a disastrous TV interview concerning his friendship with sex offender Jeffrey Epstein doesn’t quite go all the way — but the king of Sweden, for example, recently cut five blameless grandchildren from the royal house. That’s a good practice in an age when monarchies are essentially keepers of a brand rather than rulers.

In a 2006 paper, John Balmer of the Bradford School of Management in the UK, Stephen A Greyser of Harvard University and Mats Urde of Lund University in Sweden argued that Europe’s constitutional monarchies function as corporate brands. This makes sense: even when monarchs have a lot of constitutional power, as in Norway, where the king theoretically could veto any law and pick prime ministers more or less at will, it just doesn’t happen anymore.

Perhaps the only monarch who does play an active political role is the king of Belgium, who constantly has to prod parties in the country’s two nearly-independent halves to form governments together. At the same time, the monarchies have a value to the nations they serve, which can be expressed in financial terms.

In 2017, the British company Brand Finance attempted to compute that value for the British monarchy and put it at £67.5bn. The royal family’s tangible assets accounted for £25.5bn of that. The rest represented the net present value of revenue the crown brings, or supposedly brings, to the UK: additional sales achieved with the help of royal warrants (which label companies as suppliers to the court) and various other royal endorsements, extra tourism revenue, even the plot lines the monarchy provides to the film and book industries and the news it generates, helping sell newspapers and raise TV ratings.

In the fateful interview, [Prince Andrew] said he lived ‘in an institution’, as though Buckingham palace was some kind of orphanage or sanitarium  

Brand Finance calculated that all these contributions are worth £1.8bn a year. Compared to that, the monarchy’s cost — £82.2m in the latest financial year — doesn’t look excessive. If the monarchy were a business with as many employees as the royal family has members, currently two dozen people, it would be an extremely low compensation cost.

The UK monarchy, however, is among the most expensive in Europe from the taxpayers’ point of view. One can’t be quite sure about that, because the official costs of royal families are hardly ever complete. A few years ago, a leading Norwegian daily calculated that the monarchy cost Norway $55m a year — almost twice as much as officially reported, because of hidden security and other costs. In the Netherlands, the monarchy’s official annual budget is about €60m, but some estimates of its total cost have run as high as €350m a year.

If one compares just the official numbers, though, the UK royal family’s most recent annual budget allocation is 15 times as high as that of the Swedish one, which gets by on about $7m a year. Some Swedes feel even this is too much, and in response to that sentiment, King Carl XVI Gustaf, in October, removed the two children of Prince Carl Philip and the three children of Princess Madeleine from the list of royal house members who are entitled to compensation from taxpayer funds for performing official duties.

That left the House of Bernadotte [the royal house of Sweden] with just 10 members who receive a subsidy for public service, though the royal family counts nine more, including the five children.

Royal reading, ’riting and and ’rithmatic

In their paper, Balmer, Greyser and Urde wrote of the five “Rs” essential to a crown brand: royal, regal, relevant, responsive, respected. Of these five, only the first one applies to Prince Andrew: he’s royalty by birth. The other four “R’s” refer to behaviours that support the value of the brand.

People aren’t born with those, and they can’t be expected to behave a certain way simply because they were born into a certain family. Pursuing these behaviours is a heavy burden. In Sweden, the parents in the two princely families clearly didn’t want it for their kids.

Princess Madeleine, married to British-American financier Christopher O’Neill, wrote on Instagram that outside the royal house, her children would have “a greater opportunity to shape their own lives in the future as individuals”. Prince Carl Philip and his wife Sofia, an ex-model, wrote that their kids would enjoy “freer choices in life”.

That’s probably something that should have happened to Prince Andrew, too. In the fateful interview, he said he lived “in an institution”, as though Buckingham palace was some kind of orphanage or sanitarium. It’s hard to feel sorry for him, but not everyone is suited for the role of a royal brand guardian.

As my Bloomberg Opinion colleague Alex Webb wrote recently, Prince Andrew’s fall may help Prince Charles, the heir to the British throne, advance his long-standing plan to make the royal family leaner. The Swedish example shows this is quite possible. It doesn’t really detract from the reigning house’s cachet to have fewer members who serve as national symbols than there are people with royal blood in their veins. Nor does a smaller number of royals with public responsibilities affect the value of the crown brand in the way hapless royals’ misadventures can. The fewer of them, the smaller the risk to those essential “Rs.”

The UK doesn’t have to wait for its royal family to decide to become more like the Swedish one. The British democracy can push the monarchy in that direction by drastically cutting its budget, perhaps to the Swedish scale, and forcing it to select the worthiest members for public service.

On the other hand, if Brand Finance is right and the ability to generate plot twists and tabloid stories contributes to the royal brand value, perhaps endless scandal is a valuable part of what the British taxpayers are funding.

• Bershidsky is Bloomberg Opinion’s Europe columnist.

Bloomberg