Can family companies survive the winds of change? A cry for legislative help
Did you know that most of the successful businesses in the Gulf are in fact family owned? Did you also know that only a small minority actually survive into the second generation? Three factors are mainly to blame.
First, the natural stresses of family dynamics, sibling rivalry and a failure to educate and inspire the new generation to become stewards of the family legacy is a factor. Second, the dilution of ownership naturally occurring as part of the estate devolution rules often results in the business being run by a bickering committee of family heirs and not all businesses survive being governed in this way.
Without a properly pre-framed family rule book, no business can prosper in the face of unresolved family conflicts, deferred decision making and general bad management. This pushes the family into going their separate ways by breaking up or dividing the business thus undermining a once successful economic force. Family businesses are often better off staying together, their market strength and staying power stems from this unity. This divide may ultimately end the business and deprive the coming generations of the family legacy…
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