Family business: Cornerstone of the economy
Gerrit Esterhuyse
Family businesses are the cornerstone of most economies, they create innovation, jobs and drive returns.
According to research done by the global professional membership association, Family Firms Institute, family-owned businesses create between 70% and 90% global GDP per year.
We know that the most successful family businesses are those in which there is a good balance between professional management and responsible business ownership on the one hand, and a healthy family dynamic on the other.
When it comes to managing family ownership effectively, there are four key areas.
Purpose and values
This can be a major competitive differentiator for your family business if properly activated. Be specific about your values: write them down, communicate and act on them. This will help you make better business decisions.
Governance
This encompasses governance of both the business and of family matters. Corporate governance focuses on the control and leadership of the business and the roles of the various parties involved in managing it. Family governance deals with the dynamics, roles and relationships within the business-owning family.
In general, the larger the family business and the higher the number of family members involved, the more vital it becomes to put structures in place to ensure the needs of all family shareholders are met.
Wealth
Owners of successful family businesses need a strategy for protecting their personal wealth and structuring it for growth. This need is more important today, given the rapid changes in the economy and the way of doing business.
Business continuity/succession
Helping to achieve a smooth and well-managed succession to the next generation of the owning family is crucial.
Succession is one of the most critical factors in sustaining the success and continuity of any family business. This means it isn't simply an event, but a process that must be planned carefully.
At PwC, our purpose is “to build trust in the Namibian society and solve important problems.”
Family-owned businesses embody the stability we are committed to supporting. Acting as the backbone of the Namibian economy, family businesses generate more employment and economic output than any other type of commercial organisation.
That's why maintaining the success and continuity of family businesses is key to a sustainable future – and lies at the heart of our purpose.
• Gerrit Esterhuyse is the assurance leader at PwC Namibia. Contact him at [email protected]
Family businesses are the cornerstone of most economies, they create innovation, jobs and drive returns.
According to research done by the global professional membership association, Family Firms Institute, family-owned businesses create between 70% and 90% global GDP per year.
We know that the most successful family businesses are those in which there is a good balance between professional management and responsible business ownership on the one hand, and a healthy family dynamic on the other.
When it comes to managing family ownership effectively, there are four key areas.
Purpose and values
This can be a major competitive differentiator for your family business if properly activated. Be specific about your values: write them down, communicate and act on them. This will help you make better business decisions.
Governance
This encompasses governance of both the business and of family matters. Corporate governance focuses on the control and leadership of the business and the roles of the various parties involved in managing it. Family governance deals with the dynamics, roles and relationships within the business-owning family.
In general, the larger the family business and the higher the number of family members involved, the more vital it becomes to put structures in place to ensure the needs of all family shareholders are met.
Wealth
Owners of successful family businesses need a strategy for protecting their personal wealth and structuring it for growth. This need is more important today, given the rapid changes in the economy and the way of doing business.
Business continuity/succession
Helping to achieve a smooth and well-managed succession to the next generation of the owning family is crucial.
Succession is one of the most critical factors in sustaining the success and continuity of any family business. This means it isn't simply an event, but a process that must be planned carefully.
At PwC, our purpose is “to build trust in the Namibian society and solve important problems.”
Family-owned businesses embody the stability we are committed to supporting. Acting as the backbone of the Namibian economy, family businesses generate more employment and economic output than any other type of commercial organisation.
That's why maintaining the success and continuity of family businesses is key to a sustainable future – and lies at the heart of our purpose.
• Gerrit Esterhuyse is the assurance leader at PwC Namibia. Contact him at [email protected]
Comments
Namibian Sun
No comments have been left on this article