According to the latest research by KPMG Australia there is more to transition in a family business than deciding what date the leader will step down and deciding who will take over. It’s a complex task and needs a plan – not just a list of tasks but one that encompasses the business imperative, family goals and aspirations for the business’s future. In conjunction with the University of Adelaide’s Family Business Education and Research Group they talked with seven family businesses about the critical actions for long-term sustainability. Three key themes emerged: succession planning, leadership diversity and entrepreneurship across generations. There is no one-size-fits-all approach when it comes to succession planning and certainly planning retirement based on age isn’t right for everyone. Knowing when to ‘go’ can be difficult and in a family business, where your connection is personal, it can be challenging. But ‘hanging in’ can be detrimental for the next generation who may not be willing to stay with no roadmap for the future. One of the benefits of a succession plan is the opportunity to build diversity within the leadership. While having a family member is key in Australian family businesses and ideally the leader should be selected on merit, readiness and passion and not gender. The transition plan needs to include all of the interested and capable next generation to encourage the next generation to explore and communicate their interests and commitment to pursuing a leadership role. COVID-19 has exacerbated the caring responsibilities of work-oriented parents even further. and just as large organisations facilitate diversity by introducing flexible working, so should a family business. Importantly, work early to develop knowledge, skills and experience in the next generation to ensure they are prepared to step up to lead. It is often said the first generation creates the wealth, the second grows it and the third blows it. While this is a stereotype, it is often true that the greater the pool of financial resources, the more risk averse and the less interest in trying to grow it. In many family businesses the second and third generations stand to inherit significant capital, and many find themselves having to decide whether or not they want to be safe custodians of the wealth or wish to grow it further which may involve some risk taking. Providing emotional and social conscious can help overcome the pitfalls of entitlement and encourage commitment among younger family members. Part of this is encouraging open dialogue where all generations have clarity around each other’s goals and values on what they want the future of the business to be. To continue growth, family businesses need to maintain the entrepreneurial spirit that first inspired the founder. There are many effective ways of sustaining this between generations. Implementing formal succession plans, so all members of the family know their responsibilities now and into the future allows the next generation the freedom to develop entrepreneurship skills within the safety of an agreed plan and the safety to fail in the security of the families’ support of new ideas and ventures. Whilst family businesses largely smoothly navigated through COVID-19 the fallout will continue for generations to come. Planned investment in these future generations will ensure the family business continues long after the immediate effects of the pandemic fade. Check out the full report below:

William Croxson established his wholesale bottle merchant business in London in 1872. Today, nearly 150 years later, both the family name and the family business are as strong as ever. They’re very proud of this heritage, especially over the last 40 years, where there has been a huge evolution of the company. Building on the vision of chairman James Croxson, they are now well-established as an international expert in single-source, multi-choice glass packaging. And with these solid foundations in place, the next 150 years look like being even more successful. We spoke to Tim Croxson, the fifth generation of the family business to find out more. When was the business founded? The business started in 1872, so we will be celebrating 150 years in 2022. What does it do? We design and supply glass containers and closures to food, drink, beauty & cosmetic manufacturers and brand owners. For example, a lot of craft beer and gin finds a home in one of our bottles. Tell me a little about the history of the business? William Croxson, the founder, my great-great grandfather, trained as a wine cooper and went into the wine business as a broker in London. At that time, glass bottles were expensive as they lacked the manufacturing techniques we see today, so every bottle was reused. William saw an opportunity for a cradle to grave type industry, collecting used bottles, cleaning them, then filling them with wine that he purchased. What generation are you and what are your first memories of the family business? I am the fifth generation, and my first memories were of coming into the office at weekends, playing with the Telex machine. Whilst certainly not appreciating the finer details of what the business did, I think the majority of memories were more around the team of people who worked for the business, something that remains just as important to us today. Are there any other family members working in the business? My father is still involved as Chairman of the Group, with more of a focus on our international companies. How important was the business in your life as you grew up? It would be foolish to not recognise the benefit/privilege that growing up around the business gave me. It offered part-time work as a young lad but also gave an aspiration as well as demonstration of what hard-work was and the level of commitment required to run a business. What was your journey into the family business and what do you do now? I have been full-cycle – from desire to work in the business, to wanting nothing to do with it but then wanting to apply my education to the company, to help it be and do better. My first formal role was working in the warehouse, running the forklifts, and whilst still retain oversight of that area, I progressed into marketing and operational roles with secondments at two of our group business. I am now Chief Operating Officer of the Group, but, uniquely, heavily involved with the strategic direction of the business. As a multi-generational business, what has helped your firm stand the test of time? At senior level, whilst sometimes taking a little longer than we would like, we haven’t been afraid to make the tough decisions and address our own challenges and change what we are doing if it isn’t working. It would be fair to say that change is a constant. Our team are singlehandedly the most important asset we have – the sense of team in our daily collaboration and work is really vital, and whilst having naturally changed over time, was one of the things that struck me when I first started working. What values are important to the family and the business? Honesty, hard-work, fun. Do you build the family ownership into the marketing and brand narrative and if so, how? We describe ourselves as the family of packaging. Whilst a double play on our history and the full suite of packaging that we offer, we are proud of our history. We use the family business line to most effect in describing how we work as that has the most significant difference compared to a business which is either corporately owned or lacks the long-term strategy and experience. What do you think makes working in a family business special? The sense of family. We treat all of our team as family. There is a greater patience and grace shown than in other types of businesses. Are there any disadvantages associated with working in a family business? There can be massive highs with a family business, but also some massive lows – when it goes wrong … and impacts on family relationships. At its hardest, when decisions are the greater good versus family, with the fall out being, ultimately a break of relationship, that is when you wear the scars of a family business. The toll it can take on yourself and your own family can be high, emotionally, mentally and physically. Having a strong family unit or peers is vital for support and a sounding board. Have you taken any particular steps in terms of governance to help protect the business for the future? We have been blessed with an amazing board of professional directors, some outside hires, some internal promotions. This ensures a balance, and we are clear that we only want people who show integrity and a willingness to say it how it is, rather than trying to play politics. I s there a next generation in the wings? Potentially, but still of a young age. It is difficult though to not look at my children and start wondering, even evaluating… What advice would you give to anyone in the next generation considering joining their family firm? Either be prepared to start at the bottom, work really hard, study and read whilst you do, or go outside of the business and come back in your own right, with all the experiences and knowledge that comes from working in different types of business and under different leadership. If you could talk to your younger self before you joined the business, what would you say? The massive lows that might come your way will hit you for six, but you will come back stronger. There are times that it will be hard, look after yourself, know how to look after yourself both emotionally and mentally. If you could sum up the family business in a few words, what would they be? Inspirational – both design and charitable work. Fun – banter is so important! Family – value is put on the individual AND their family. Team – we work for each other, when someone is down, the team responds. Innovative – both in what we do and how we do it. Find out more about the business by visiting their website here

Riso Gallo is one of the oldest rice growing companies in Italy dating back to 1856 with a factory in Genoa that processed imported paddy rice. Paul Andrews spoke to Emanuele Preve, part of the sixth generation of the family firm to find out more. Officially Riso Gallo began in 1856 but as Emanuele explains, “The business probably started prior to that date as the first official document that we have found is dated 1856 but is actually a complaint from someone about noise from the production facility so it is likely that my ancestors started the business even earlier.” As a business they produce and sell rice, milling and packaging the final product and started with the factory in Genoa and at the same time opened a factory in Argentina to meet the needs of the South American market. The business was successful and with increasing knowledge and experience in the field the focus turned to Italian crops and in 1926 the Genoa factory was transferred to Robbio Lomellina in the heart of the province of Pavia, one of the most well-known rice growing regions. As Emanuele continues, “My grandfather was entrepreneurial and in the 1940’s took the decision to brand our rice and we were probably the first rice brand in the world. It followed his hunch that resulted in a key moment in the development of the business too with the introduction of the ‘Rooster symbol’ which marked a new chapter in our history. Since illiteracy was still widespread in Argentina at the time, the company used images of animals to identify the different varieties of rice. This resulted in either a giraffe, tiger, eagle, elephant or cockerel (rooster) appearing on all the sacks of rice.” “The rooster, which identified the best variety soon became the symbol of the company, synonymous with the high quality food products provided by the business,” he adds. The business grew, expanding around the world and their products are now sold in more than 80 countries. “We have been making Italians happy for six generations,” adds Emanuele, “but our mission is to spread the culture or rice and risotto throughout the world. We are an innovative organisation that is constantly evolving to meet the needs of the modern consumer too,” he continues. Emanuele is one of the sixth generation involved in Riso Gallo today, working closely with two brothers who are actively involved in the business and a fourth brother is the company President but not involved in the operational side of things. Their father, at the age of 80, is gradually stepping back and retiring from the business. Growing up, the business was an important part of family life. “My brothers and I grew up hearing stories about the business. The company has always been a part of our lives and we grew up talking and learning about rice all the time and we appreciate that everything that we have in our lives has come from the business – rice is effectively in our blood,” explains Emanuele. Prior to joining the family business Emanuele graduated as an Economic Engineer before working for several large businesses in finance and administration roles (Pirelli, BMW and Unicredit) and then joining the business as Chief Financial Officer in 2013. Emanuele is well aware of the family business narrative and respectful of the history and heritage that is behind the global brand that exists today. “With underlying values of tradition, quality, passion and reliability at the heart of the family and the business, we have evolved and remain relevant today. As a multi-generational business we have stayed the test of time and believe this is due to tradition and innovation. We were the first rice brand, were pioneers with the development and introduction of parboiled rice, focus on quality and continually invest in brand awareness, all of which help to drive the business forward,” continues Emanuele. “Our brand is recognised the world over, certainly helped by the rooster image and our products are recognised for their quality,“ he adds. Working for a family business can be a uniquely special experience too and Emanuele is respectful of the past, noting that “working for something that came from your ancestors and that you plan to pass on to your sons represents so much more than just being a shareholder of a company. There are many positives about working in a family business like ours although it is sometimes difficult to separate the emotion from the business too.” Governance is also important for the family and the appointment of a non-family CEO has helped in professionalizing certain aspects of the business and helping prepare for the arrival of the next generation too. With eleven nephews ranging in age from 6 to 23, there is a large next generation in waiting so steps have already been taken to prepare the family and the business going forward. As Emanuele adds, “We have rules for the next generation entering the business with one person per family branch, the requirement of a university degree, the ability to speak four languages, three years of experience working outside of Riso Gallo and an appropriate opening of a position within the business too.” Riso Gallo is planning for the future and continues to be a business full of passion, experience and continuity is on the agenda. This is a ling standing, multi-generational family business with plans in place to continue for generations to come. As Emanuele concludes, “Life in the family business has been good to me and I am proud to have joined the business and to continue to help the business flourish since joining. As I said earlier, I guess rice is in the blood and it is a real honour to successfully continue the work that was started by my ancestors back in the 19th century.”

Keela was founded on the East Coast of Scotland, the perfect place to innovate and test outdoor garments for the changeable British weather. They continue to provide UK-led garment designs. Their aim is to provide quality outdoor clothing packed with innovation and technology, and after over 25 years they continue to enhance their reputation based on these principles. Paul Andrews caught up with Sam Fernando, Sales Director and second generation family member involved in the business to find out more. When was the business founded? The business was founded in 1979 with Ardmel; the Keela brand came later in 1980. At that time there were 3 directors, including my father. What does it do? Ardmel Specialist Engineering innovates, develops and manufactures machines and consumables for the clothing, electronics and motorcar industry. They are best known for the tape sealing machine and ultrasonics, for which Ardmel won a Queen’s Award for Innovation. Keela is the Outdoor brand. We manufacture technical outdoor clothing for the outdoor professional – Mountain Rescue, ambulance, police etc, and for the amateur outdoor enthusiast whether that’s a runner, dog walker or mountaineer. Tell me a little about the history of the business? Rube, my father, developed the first ever tape sealing machine and this is what really kickstarted the business. The tie-in with manufacturing of clothing followed from this with Rube’s knowledge of sewing production. In the eighties, we could see the writing on the wall in the way business was changing, with a handshake no longer meaning anything. It was painful to see so many brands moving out of the UK, typically to China. Therefore, we went our own route with the Keela brand. In the 1990s, Keela’s Research and Development team began working on the knottiest problem in outdoor gear design: how to manage inner condensation in wet and cold conditions. The result is System Dual Protection (SDP), a pioneering double layer fabric system that offers game-changing breathability. Its ground-breaking performance netted us a second Queen’s Award for Innovation. We have continued to innovate, develop, and grow from there. What generation are you and what are your first memories of the family business? I am the second generation. Much of my childhood recollections are of going to work with my father at weekends. Often, he would give us wee jobs to do, for example we would earn 20p for sweeping the floors. My mum (who was a trained midwife also played a large part in the company) and I have lots of memories of our home filled with boxes of garments. She was always quality checking the inventories or doing some other small tasks at home when the factory was very busy. Are there any other family members working in the business? Yes my brother, Ruwan, is the Operations Director and oversees the organisation as a whole. He set up the factory in Sri Lanka in the nineties, shortly after returning to the UK with his wife, Kate. My younger brother, Harry, has recently joined the engineering section. Arlene Kidd is also a Director and is family to us also. In Sri Lanka, my aunt and cousin also play pivotal roles. How important was the business in your life as you grew up? It was an integral part of our lives. When you have your own business, it invariably overlaps into family life. Holidays and weekends must be balanced with business and in the early days my father worked incredibly long hours, frequently travelling abroad. He would take us into work with him at the weekends and, of course, in any crisis, the whole family would help out. Even now, it’s never a 9-5 job and you often find yourself juggling personal commitments with the business requirements. What was your journey into the family business and what do you do now? Initially I was very against joining the business. After university I ventured down to Leicester for a new career and in between jobs I joined the firm as a temp sales rep in Nottingham. I absolutely loved it, driving all over the country for more than 7 years, living a fantastic life. But then a crisis arose at the factory and I came back to help, and have been here ever since, working my way up within the company. I am now the Sales Director, but as any other SME leader will recognise, you never do one specific job. The nice thing about a family business is that everyone does help out. What values are important to the family and the business? A can-do positive attitude, enthusiasm, drive, and the ability to think outside the box. A quirky sense of humour is probably helpful too. Do you build the family ownership into the marketing and brand narrative and if so, how? No, not really. My father came to Scotland from what was then Ceylon in the 1960’s with Singers’ sewing machines. He met my mother, fell in love, and settled down here. At the time, the Sri Lankan background was not always viewed favourably. We are quite a private family so it’s a bit alien to us to talk about our family heritage. What do you think makes working in a family business special? There’s a bond and you know that, no matter what, your family will always have your back through thick and thin. Are there any disadvantages associated with working in a family business? Ha ha of course! My father’s singing for one! On a serious level though, there are of course positives and negatives. Certainly, being in the family business has kept the family closer. Without this I may well have been down south and only seeing family for special events and holidays. The downside is that it can, on occasion, put strain on relationships both inside and outside the family. It’s important but often difficult to separate business and personal life. Have you taken any particular steps in terms of governance to help protect the business for the future? That’s an interesting question and I feel most family businesses would probably say it’s often something that is pushed to the side to look at for another day. What we have worked hard at is putting in place the right foundations – the right team is critical with good systems and processes. Is there a next generation in the wings? I think, if you asked them, you’d get a resounding ‘No!’ from the next generation right now. One of my nieces has joined the Navy and I am immensely proud of her decision. But who knows what will happen in the future? Some are still in nappies! What advice would you give to anyone in the next generation considering joining their family firm? Try your hand at something else first. It will give you a good grounding and if things don’t work out you will have more confidence to walk away. If you could talk to your younger self before you joined the business, what would you say? Buy shares in Apple! Realistically I think you learn by experience, and even when things go wrong you must learn to stand up, dust yourself off and keep going. So my advice to myself would all be on a personal level – look after your back, don’t neglect your social life and always take a holiday. If you could sum up the family business in three words, what would they be? Pretty damn awesome. You can find out more about Keela Outdoors here

For four generations in California, they have grown, dried, processed and packaged only the finest and freshest dried fruit snacks and ingredient product. Every Mariani product represents the family heritage of premium quality dried fruit. The quest for perfection began in 1906 when Paul Mariani, the immigrant son of a European farmer, arrived in the lush Santa Clara Valley. He planted fruit trees on four acres and within a few years, after working hard and surviving set backs, began to prosper. Over the years he expanded his acreage, opened new markets, and developed a keen understanding for prime fruit growing areas both locally and around the world. In 2021, Mariani are celebrating 105 as a family business and five years ago created a fantastic film to showcase their business in their centenary.

In the foreword to The Sustainable Development Goals Report 2020 António Guterres, Secretary-General of the United Nations, outlines the vision for the world to work together to help protect the planet and provide opportunities for all. As he explains, “The 2030 Agenda for Sustainable Development was launched in 2015 to end poverty and set the world on a path of peace, prosperity and opportunity for all on a healthy planet. The 17 Sustainable Development Goals (SDGs) demand nothing short of a transformation of the financial, economic and political systems that govern our societies today to guarantee the human rights of all. They require immense political will and ambitious action by all stakeholders. But, as Member States recognized at the SDG Summit held last September, global efforts to date have been insufficient to deliver the change we need, jeopardizing the Agenda’s promise to current and future generations.” “The Sustainable Development Goals Report 2020 brings together the latest data to show us that, before the COVID-19 pandemic, progress remained uneven and we were not on track to meet the Goals by 2030. Some gains were visible: the share of children and youth out of school had fallen; the incidence of many communicable diseases was in decline; access to safely managed drinking water had improved; and women’s representation in leadership roles was increasing. At the same time, the number of people suffering from food insecurity was on the rise, the natural environment continued to deteriorate at an alarming rate, and dramatic levels of inequality persisted in all regions.” “Change was still not happening at the speed or scale required.” “Now, due to COVID-19, an unprecedented health, economic and social crisis is threatening lives and livelihoods, making the achievement of Goals even more challenging. As of the beginning of June, the death toll had surpassed 400,000 and was continuing to climb, with almost no country spared. Health systems in many countries have been driven to the brink of collapse. The livelihood of half the global workforce has been severely affected. More than 1.6 billion students are out of school, and tens of millions of people are being pushed back into extreme poverty and hunger, erasing the modest progress made in recent years.” “Although the novel coronavirus affects every person and community, it does not do so equally. Instead, it has exposed and exacerbated existing inequalities and injustices. In advanced economies, fatality rates have been highest among marginalized groups. In developing countries, the most vulnerable – including those employed in the informal economy, older people, children, persons with disabilities, indigenous people, migrants and refugees – risk being hit even harder.” “Across the globe, young people are being disproportionately affected, particularly in the world of work. Women and girls are facing new barriers and new threats, ranging from a shadow pandemic of violence to additional burdens of unpaid care work.” “Far from undermining the case for the SDGs, the root causes and uneven impacts of COVID-19 demonstrate precisely why we need the 2030 Agenda, the Paris Agreement on climate change and the Addis Ababa Action Agenda, and underscore the urgency of their implementation. I have therefore consistently called for a coordinated and comprehensive international response and recovery effort, based on sound data and science and guided by the Sustainable Development Goals.” “Health systems must be urgently strengthened in countries that are at greatest risk, with increased capacity for testing, tracing and treatment. Universal access to treatments and vaccines, when they become available, is essential. A large-scale multilateral response is needed to ensure that developing countries have the resources they need to protect households and businesses. Recovery packages must facilitate the shift to a low-carbon, climate-resilient economy and support universal access to quality public services. And leadership and support are needed to ensure statistical organizations have the tools and resources to facilitate timely and smart decision-making.” “To guide and support these actions, the United Nations system has mobilized at all levels, leveraging the recent reforms of the United Nations development system. At the start of this Decade of Action to deliver the SDGs, I call for renewed ambition, mobilization, leadership and collective action, not just to beat COVID-19 but to recover better, together – winning the race against climate change, decisively tackling poverty and inequality, truly empowering all women and girls and creating more inclusive and equitable societies everywhere,” he concludes. Read the full 2020 report on progress and activities to date below:

The 2030 Agenda for Sustainable Development was launched in 2015 to end poverty and set the world on a path of peace, prosperity and opportunity for all on a healthy planet. The 17 Sustainable Development Goals (SDGs) demand nothing short of a transformation of the financial, economic and political systems that govern our societies today to guarantee the human rights of all. They require immense political will and ambitious action by all stakeholders. But, as Member States recognized at the SDG Summit held last September, global efforts to date have been insufficient to deliver the change we need, jeopardizing the Agenda’s promise to current and future generations. The Sustainable Development Goals Report 2020 brings together the latest data to show us that, before the COVID-19 pandemic, progress remained uneven and we were not on track to meet the Goals by 2030. Some gains were visible: the share of children and youth out of school had fallen; the incidence of many communicable diseases was in decline; access to safely managed drinking water had improved; and women’s representation in leadership roles was increasing. At the same time, the number of people suffering from food insecurity was on the rise, the natural environment continued to deteriorate at an alarming rate, and dramatic levels of inequality persisted in all regions. Change was still not happening at the speed or scale required. Now, due to COVID-19, an unprecedented health, economic and social crisis is threatening lives and livelihoods, making the achievement of Goals even more challenging. Read the full report below:

James Donaldson & Sons (JDS) is a family of businesses specialising in the processing, manufacturing, merchanting and distribution of timber and associated building products. The business was founded in 1860 and celebrated its 160th Anniversary in 2020. The JDS Group comprises a range of companies including timber importer and distributor James Donaldson Timber Ltd, engineered wood product manufacturer Donaldson Timber Engineering Ltd, timber merchant MGM Timber (Scotland) Ltd, insulation specialist James Donaldson Insulation Ltd, and Nu-Style Products Ltd, a fabrication specialist. In 2020, the Group also acquired Rowan Manufacturing Ltd, and Smith & Frater Ltd. Paul Andrews spoke to Michael Donaldson, Executive Chairman and the sixth generation of the family firm to find out more. JDS has grown to become one of the UK’s leading independent processors, manufacturers, merchant and distributor of timber and related products. From one small branch originally in Fife, today JDS has over 1000 employees across 33 sites. Since 1860 JDS has grown and strengthened through acquisition, diversification and an unfaltering focus on quality and service. At present we have a portfolio of eight specialist businesses within the group which are operated by the best people in the industry. Like many who grew up in an already established multi-generational family firm, Michael has fond memories of the business. As he explains, “My first memories of the family business are driving to one of our sites with my grandfather on a Saturday morning. He would always go in to make sure everybody was OK and that operations were running smoothly." "This ethos has continued too as I think there is something to be said for the senior leaders in the business to be seen on site during the tougher shifts, and to be known throughout the business, something that really came to the fore for many family firms during the past year or so too.” He is joined in the business by his brother, Andrew Donaldson who is currently CEO and their father, Neil Donaldson retired in July 2020. As Michael explains, “I am sure that like most family business owners the business formed a huge part of our lives. There were always conversations on business topics when Andrew and I were younger, and I remember my father and grandfather having their scheduled weekly catch up meetings.” “My first job was even working in the business, on the back of a saw, when I was probably too young to have been there in the first place.” When it comes to joining JDS, Michael joined the family business in 2002 straight after qualifying with his honour’s degree from University. As he continues, “I took on a variety of roles across the group whilst gradually learning and developing my skills and knowledge in the areas which were most likely to be advantageous to me going forward.“ “In 2007, I had the honour of being the first ever student to graduate with a Timber Industry Management degree from Edinburgh Napier University. Shortly after graduating, I joined Donaldson Timber Engineering as General Manager of our Scottish Division, a role which I did until 2011. I then moved internally within the Group to join the leadership team at James Donaldson Timber from 2011 to 2015. I moved again in 2015 and joined MGM Timber as Commercial Manager, and shortly after Commercial Director in 2017,” continues Michael. “Since 2018, I have been working for JDS at Group level, firstly as Deputy Chairman, and most recently Executive Chairman, after my father retired in July last year and handed over the reins. My role as Executive Chairman involves leading our board of directors and acting as the main point of contact for all of our shareholders, both family and colleagues.” JDS dates back to 1860 and has stood the test of time when other businesses have not so what has helped them survive and thrive? “JDS has benefitted over the years from strong leadership, being guided by our values and being prepared to invest in the future by recruiting the most talented people in the industry,” explains Michael. “This has clearly helped, together with our core values that are integrated into the culture of who we are as a business. Our core values are People, Family, Customer, Integrity & Sustainability and every person working for the JDS group, no matter which business they are part of, understands the importance of our values. We test and measure ourselves against them regularly, to ensure they guide our approach and behaviour,” he adds. As Michael continues, “Family is one of our core values. Our core values genuinely are at the heart of the way we operate and guide our decision making daily. The fact that our business is still within the Donaldson family six generations later proves that family ownership is part of our brand narrative to this day. Furthermore, as a family business, we pride ourselves on using these values to behave ethically, morally and responsibly at all times. Our people, customers and suppliers recognise this and see that this adds value to their business and differentiates us from competitors.” Family business are unique in so many ways and the contribution of family firms continues to be celebrated as Scottish family firms like JDS are the engine room of the Scottish economy. In fact, the Top 100 Scottish family firms collectively generate more than £22 billion annually and employ over 111,000 people. As Michael adds, “Family firms are unique and even if you aren’t part of the Donaldson family, we try to make every employee across our businesses feel like they are part of something bigger than themselves, as one big family. We don’t just set our goals for the next quarter or year, we think in years, and even decades ahead. This gives our employees a sense of stability and they tend to stay working with us for many years.” Running a family business is a balance and for some, as well as the positives there may be downsides too. As Michael continues, “Anybody can find negatives in any business they work for, so our role as leaders of this business is to make sure that there are far more positives than there are negatives. If I had to pick one potential frustration, rather than disadvantage, of working in a family business it would be, it could be argued, that family businesses tend to err on the side of caution and as a result sometimes grow at a slower rate than other businesses might. It is debatable however whether slower more sustainable growth is better or worse than quick expansion.” Family businesses that have evolved over longer periods of time tend to add more structures and governance frameworks to help prepare and protect the business for the future. JDS is now exception and in many ways leads the way in their long term view. As Michael explains, “For many years now we have used the phrase ‘a family business, held to PLC standards’ and this has helped with the governance of the business for the last 20+ years. We have 4 non-executive and three executive directors who sit on our main board and three subcommittee’s (remuneration, audit, nominations) below the main board which all have terms of reference to work too.” “I believe that the governance structures we have in place are suitable and appropriate for a business of our scale to ensure the long-term sustainability of the group,” he adds. For long standing family firms like JDS the succession planning process is always on the mind. As Michael explains, “For us the future depends on the next generation and on their career aspirations. Andrew and I are custodians of this family business for the next 20 years or so, and of course it would be great to see our children come into the business when they are of age, but it will be up to them. G7 are all still at school, or even too young to be at school yet, so there is plenty of time before any decisions need to be made on their future aspirations.” As the sixth generation leader of the business Michael has obviously been through a journey with the family business, moving from the next generation to the now generation and leading from the front. He is a great advocate for next generation members to follow their dreams, adding that “For next gens thinking about joining their family businesses, they should not be afraid to challenge the norm and be curious. Just because things have been done a certain way in the past, does not mean it’s the best way. If you have an idea, share it. Always be learning and always be curious as there is a lot to learn outside of your family business bubble.” For Michael, it is clear that family business is all about continual learning and improvement but when looking back to the start of the journey, what advice would he give to his younger self before embarking on the journey? “Don’t be so hard on yourself, trust your instincts more and just be yourself,” he concludes. Clearly, this is a family business that has come a long way since it was founded way back in 1860. Clearly this business has a solid past and it is clear to see that a promising future lies ahead.

Tom Young MBE and daughter Karen produce beautiful glassware, creating the very best in innovative and creative concepts. Together they have supplied some of the world’s leading distillers with products used for the distilling process. The idea for the business was born out of the Legend of The Angels’ Share After watching a Film in 2012 of the same name by Ken Loach Karen & Tom designed the Whisky Angel. This is now the signature product. Paul Andrews spoke to Karen Somerville to find out more. What is your position in the business? Director & Co-Founder When was the business founded? 2013 What does it do? We are a specialist glass manufacture and producer of giftware Tell me a little about the history of the business? Formed by Dad and daughter, we used skills of glassblowing to match creativity and created an icon for scotch whisky along with innovative designs for barware and glass gifting. What generation are you and what are your first memories of the family business? First but second really – my dad has an MBE for his services to the glass industry and he has been glassblowing for over 65 years. Are there any other family members working in the business? Yes my husband is also part of our small team. How important was the business in your life as you grew up? I was immersed in my dads craft. As a young girl I watched him his every move and although I don’t glassblow myself I feel like I know exactly what needs to be done to achieve certain finishes and techniques. What was your journey into the family business and what do you do now? I set off wanting to travel and do languages and I ended up in travel retail before I helped my parents in their business when I was in my late twenties. Dad always wanted me to go and do my own thing and if that gravitated back to his business then fine. So I joined the company in 1999 and it was retired and sold on in 2005 – so I went back into retail management and operations for a local university. Then in 2013 Angels’ Share became a thing and dad was pulled from retirement. What values are important to the family and the business? Authenticity and transparency. Do you build the family ownership into the marketing and brand narrative and if so, how? Yes very much so , all our marketing is around family tradition , heritage and longevity of a craft. What do you think makes working in a family business special? TRUST Are there any disadvantages associated with working in a family business? Yes, you never stop talking about business! Is there a next generation in the wings? Possibly I have two sons and one is already very keen to get involved but he is young and like my father I will probably set him out on his own path and if he levitates back then so be it. What advice would you give to anyone in the next generation considering joining their family firm? Be aware of what has been built before. If you could talk to your younger self before you joined the business, what would you say? You should have had this idea years ago! If you could sum up the family business in three words, what would they be? Good honest work Find out more about Karen and the business here

Chris Kelly is the Managing Director of The UPAC Group in Scotland. He spoke to Paul Andrews to share his insight into this second generation family business. What does your family business do? We are the fastest growing packaging supplier in Scotland. As a collective, The UPAC Group offers the best solution for any packaging needs, with access to specialist machinery in the manufacture of corrugated boxes, solid board cartons, lithographic laminate boxes, polythene products, labels and a distribution arm to ensure unrivalled packaging services. In addition, we have a full in-house design team, specialising in the design of bespoke boxes and packaging. Our innovative ‘U-Chill Box’ has become a staple for food retailers and restaurants alike, as their businesses move online and over to a home delivery service as a result of the pandemic. When was it founded? 1970 How did you get involved? I was on gardening leave having accepted a new job in Dubai and had a 3 month window. Dad asked for help restructuring the business and the job started to grow arms and legs. I had no intention to stay but it was such a pleasure working with dad and shaping a company, as opposed to working for someone else that, to be honest, it felt like the most natural thing in the world. What did you want to be when you grew up? I wanted to work for Dad. Honest truth was, as a child, I had really bad bronchitis and was constantly at the doctors. I have fond memories of my dad taking me into the office in the mornings before my doctors appointments and I loved it. Dad seemed have a great life, he worked with his cousin Gerry and watching the two best friends working together always seemed like such great fun. What is your role in the business today? I take on all roles as the Managing Director. I sit in the middle of the open office, overseeing every aspect of the business, without micromanaging. I want to have enough of an understanding that I can offer advice and instruction without having to carry out tasks. It’s more of a guidance role. What are your first memories of the family business? Walking into the warehouse and thinking it was the greatest place in the world… 5000 sq ft, pallets everywhere, the greatest den any kid could ever have! Forklifts were buzzing about, everyone was really busy and there was my Dad, bossing everyone about in the worlds greatest den. What values are important in your family/family business? I have a responsibility to everyone that works for me, peoples livelihoods are reliant on me doing the right thing- so I have little tolerance for anyone that doesn’t respect the job because the job looks after everyone. What is the best thing about being a family business? I guess it’s the sense of family it creates. Look. You laugh, cry, but more than anything else, I know there are people in the organisation that support and understand the pressures and needs of the business. There is implicit trust. Not always agreeing, but trust on certain aspects. At UPAC, we treat everyone like family, that doesn’t just extend to direct family, but that’s what underpins this business… everyone should feel part of the greater family. My staff would walk into battle for me. The sense of community that a family business creates- familiarity breeds contentment and a closeness, and can dissolve some of the office politics that may be problematic in a more structured business. I guess I am fortunate that I’ve primarily worked in environments where collaboration was key- no idea bad. And the worst? You feel additional pressure to look after everyone. My problems are not my problems, I feel responsible for other people that goes way beyond a working obligation. What is the best thing about your working day? I really love whizzing about the office on my new electric scooter and having a laugh with my team. What is your proudest family business achievement? When the other family members came onboard. Employing my two sisters. Bottom line is I don’t require a lot, the money in this business is used to help other people and assist my own family members achieve. I’m not reckless with money but at the same time when running this family business I’m not answering to external shareholders- we are not a lifestyle business. We don’t issue dividends, money goes back into business. Is there a next generation waiting in the wings to take over? That’s dependant on the next generation. I have no ambition to hand the company over but at the same time, I don’t preclude the possibility. I always wanted to run the business and work for Dad, if other family members want to come in, the door is wide open but there’s no pressure to join. What do you see as the biggest challenge facing family businesses? Family politics. What words do you associate with family businesses? Loyalty, sacrifice, reward and transparency.

UK family businesses risk falling behind other countries in their commitment to prioritising sustainability in their strategies, according to findings from PwC’s latest Global Family Business Survey. While more than half (53%) of UK family businesses surveyed believe they have a responsibility to fight climate change and its related consequences, only a third (33%) have developed and communicated a sustainability strategy compared to the global average of 37%. The survey reveals 79% of respondents in mainland China, 78% in Japan and 49% globally report ‘putting sustainability at the heart of everything we do’ compared to 39% in the UK. Hannah Harris, PwC UK Family Business leader, said: “A commitment to a wider social purpose has always gone hand in hand with family business in the UK, but there is growing societal pressure from employees and business stakeholders to demonstrate more meaningful action around sustainability and wider ESG issues.” “Listed companies have started to respond, but our survey shows that UK family businesses have a more traditional approach to social contribution such as contributing to the local community or philanthropy. It is on family business to adapt to these expectations or they risk creating a potential business risk.” Growth With business still feeling the effects of the COVID-19 pandemic, expectations for growth within family businesses is split right down the middle. Out of the UK respondents, only 53% expect to see growth in 2021. However, the outlook for next year is much more positive with 86% expecting to see growth. Priorities Family businesses are known to be agile and embrace change, which is reflected in their key priorities for the next two years. Top of the list is improving digital capabilities (60%), followed by introducing new products and services (53%) and increasing use of new technologies (47%). Covid Impact And Succession Over the past year, UK family businesses went further in comparison to the global average when it came to providing support for staff during the Covid-19 pandemic and the sacrifices family shareholders made. Eighty-six per cent of respondents retained as many staff as possible and 72% provided emotional/mental health support for staff compared to the global average of 76% (retained staff) and 45% (provided emotional/mental health support) respectively. More than half (54%) of family shareholders took a reduction of dividends, 44% reduced their bonus and 40% reduced their salary. The majority of first generation UK family businesses expect that the next generation will become the majority shareholders within five years time. Just over a quarter (26%) say they have a robust, documented and communicated succession plan in place. Hannah Harris added: “The COVID-19 pandemic has shown UK family businesses remain resilient in the face of a crisis, underlined by the efforts they have made to retain staff, provide extra help for employees and make financial sacrifices.” “With society slowly moving towards some kind of normality, family businesses will look to build on their digital capabilities, while managing family dynamics and looking to invest in more sustainable business practices.” Download and read the full outlook report below:

Planning to stay one step ahead. A compass for family business succession. Artificial intelligence, the ESG avalanche, increased global mobility and a virus that has turned lives upside down and shifted behaviour and one thing is clear: the world is not the same as it was some years ago and trying to plan for a transition in today’s environment is challenging at best. Despite all that, somehow, the world carries on and business families, entrepreneurs and landed estates everywhere are having to press on and go about their lives, whilst encouraging next generations to add their own brushstroke to the family’s canvas; The aim? Success(ion). “Everything is constantly shifting, changing, and becoming something other to what it was before.” Heraclitus. Suffice to say that the world is rather different to what it was some years ago and trying to plan for a complex transition in 2021 and beyond is not an easy task. However, certain things remain unchanged and for those long-established family businesses the show must go on and ensuring the survival and prosperity of their legacies through next generations remains vital. A quick internet search will show that there is much guidance and so-called golden rules around how to tackle family business succession and yet, despite a plethora of academic and real-world research, the practicalities remain shrouded in mystery, often leading to unanticipated realities, mishaps and even family feuds. And whilst change may well be the only constant in nature, as the wise Heraclitus once said, it can be constructively planned for and managed; you only need to look at some of Japan’s 1st millennium-established businesses for proof (think Ryokan and Onsen families) or Europe’s famed wine-making pioneers like the Antinori or Codorniu dynasties. The Family Business Succession Maze Before diving into the practicalities of family business succession, it is important to understand what drives certain reactions from those involved in the process. Studies suggest that when a family member is faced with a decision, the impact is rarely limited to either themselves or business. For example, a mother who is a director and shareholder in the family business is faced with a dilemma if her youngest asks to take over the business, having less experience than their siblings. If she agrees, how might her other children respond? If she doesn’t, how will her child feel? And how will this impact the business? Wearing multiple “hats” is a muddled affair, however one thing is clear – in an environment of finite resources such as time, love and money, deciding on the optimal allocation split is no easy matter; Enter Success(ion). The Duality Of Family Business Succession Succession planning in family businesses can sometimes take a back seat. This is mostly due to the sensitive nature of the topic as well as its intrinsic finality. This is also why perhaps a better word for it should be “continuity” rather than “succession”; after all, without inviting an etymological debate, the next generations are continuing the family’s legacy rather than purely succeeding the current owner or leader. Postponing the conversations around who should take over invites a twofold dynamic. Most of the times continuity is considered from both an ownership and a management lens. That is to say that a family need to decide a) who will succeed in leading the business and b) who will own it – not always the same candidates and indeed often not. Whilst for some families there is a clear answer (i.e. families following a primogeniture model), for others it is a complex decision that requires thought, time, planning and careful consideration (remember the resource allocation dilemma?). Taking The First Step How best to approach the topic will vary from family to family. For some, the subject may be broached either at a family meeting or as an agenda item with the Family Council. For others, a more informal approach may be more appropriate, for example over the weekly Sunday dinner. As for the right age to have such conversations, again, some families chose to do it when their offspring are in their 20s (or earlier as observers at meetings), whilst others prefer to wait until the next generation are more experienced and may be well into their 30’s or 40’s (likely coinciding with them taking up a significant role in the business) and perhaps are parents themselves. It is therefore important to consider carefully what will work for you and no one method is wrong. There is however wide consensus that the earlier, the better and having your children getting used to the language of the business can help – just like learning a foreign language! The secret appears to be open communication. Once you have decided on the most appropriate format and time for the discussion for your family, you should also consider the following: Who will be involved in the process and how will communication and decision-making work – Current generation and next generation only? Spouses? Any non-family members? What is your intended outcome for the process and how does this align with your family’s shared purpose – What type of ownership do you want? Do you want to keep it in the family? Transition to non-family management? Create a philanthropic legacy? How are you going to achieve that outcome – What roles and responsibilities are needed from those involved? What is your talent pool and what should you start doing now? What is the timing? Seek Support For families where communication is challenging or where there are numerous parties to consider, typically an external adviser will be introduced to help facilitate discussions. For some, this may be a long-standing trusted adviser who is familiar with the family background, whilst for others, having a new and independent voice can be more conducive to constructive discussions. The ultimate decisions remain in the hands of the family; however, an advisor can guide the individual members through the process, whilst sharing experience, de-personalising scenarios and keeping discussions and progress on track. Food For Thought There is no magic answer. Continuity is an emotional transition whose complexity can be alleviated by the stakeholders’ commitment to the process. To get them there, you can try these: Together as a family endeavour to normalise the topic at an early stage and encourage views from all generations When faced with a disagreement try reversing roles and consider why the other party might react in a certain manner Remain flexible and open-minded; the process will evolve as those involved do and documenting a set of rules can help provide clarity and set expectations In our experience families are nervous about starting these conversations but are also pleasantly surprised with the outcome, which is usually different than what they expected. Be brave and get started! Andra works closely with families and family offices, supporting them in managing their businesses, their wealth and understanding their aspirations. Andra takes a holistic approach when advising clients, focusing on family longer term succession planning and family governance.