Why families stall around people and leadership—and what helps move things forward Most families don’t call us in a crisis. They get in touch when something’s been hanging in the air for a while. Talked about. Circulated. Tension rising—but no real movement. You know the kind of thing: “We’ve talked about it loads—but nothing’s actually happened.” “We think we need someone—but we’re not sure what for.” “We need to sort succession—but it’s never the right time to bring it up.” These conversations get raised, then dropped. Everyone agrees there’s something to look at—but no one wants to push too hard. It’s rarely about strategy. It’s nearly always about people . Who’s leading? Who’s stepping up? Who’s stepping back? What roles are needed? What decisions haven’t been made? And most of the time, it’s not indecision—it’s lack of clarity. A familiar example: I worked with a family where the founder had been circling the idea of a CEO for years. The daughter was capable, ready, and already doing much of the job. But nothing had been said out loud. The board didn’t want to interfere. The founder wasn’t quite ready to let go. Everyone was waiting for someone else to name it. And because no one did, the conversation never quite landed. They weren’t confused. They just hadn’t put the people and leadership piece on the table properly. This is the moment I’m most often called in. Not when the board is imploding. Not when someone’s walking out the door. But when something about leadership isn’t working—and no one knows how to say it. That’s where we’re useful. We’re not consultants. We’re not coaches. And we’re not a recruitment agency chasing roles. We work with families to get clear on the leadership questions they’re sitting with. What’s going on? What’s needed? What’s possible? And what’s in the way? What helps? Here’s what I’ve seen work again and again: Write it down . Once people can see the full picture in black and white, things tend to shift quickly. Ask better questions . Instead of “Should we hire someone?” try “What kind of leadership do we actually need—and why now?” Don’t rush the action . You don’t have to decide straight away. But until you’ve got clarity, you’re not deciding anything at all. One Final Thought Family businesses don’t stall because they don’t care. They stall because people and leadership issues are personal—and hard to untangle when you’re inside them. But once things are out in the open—clear, calm, and properly understood—families almost always know what to do. And that’s when the real conversation starts.

After more than a decade advising entrepreneurial families across Central Europe, I have learned one thing: family businesses rarely collapse because of poor strategy. They collapse because difficult conversations were postponed for too long. Markets shift. Industries transform. Technology disrupts. Strong businesses adapt. What they often fail to adapt to, however, is the internal transition of power, identity, and authority inside the owning family. That is where the real risk sits. The Greatest Risk Is Inside The Ownership System In family enterprise, the most significant risk factor is not competition. It is the owner — and the owner’s family. This is not criticism. It is structural reality. Family businesses operate at the intersection of three systems: family, business, and ownership. Each system follows different rules. The business rewards competence and performance. The family values belonging and emotional loyalty. Ownership focuses on capital, control, and returns. When these systems are not consciously aligned, tensions accumulate quietly. In founder-led companies, strong personality often holds everything together. The founder acts simultaneously as majority shareholder, CEO, and central family authority. Decisions are fast. Power is clear. The system works — as long as the founder works. But concentration of authority is not governance. It is dependency. And dependency becomes visible the moment succession approaches. Succession Is Not A Transaction. It Is A Power Shift. Most families approach succession as a technical problem. They call lawyers, tax advisors, wealth planners. They restructure holding companies. They optimize ownership. Then they are surprised when the real conflict emerges in the meeting room — not in the legal documents. Succession is not primarily a transfer of shares. It is a transfer of authority and identity. Founders often struggle not because they lack a plan, but because the company is part of who they are. After thirty years of building, the business is intertwined with status, relevance, and personal narrative. Letting go of operational control can feel like losing oxygen. At the same time, successors face a different challenge: legitimacy. They must lead a company where employees still emotionally report to the founder. Without clear role separation, the classic managerial bypass appears — staff going “around” the new CEO back to the founder. I have seen companies where the founder formally stepped down — but continued approving investments informally. In one case, a development project costing hundreds of thousands was green-lit without the knowledge of the successor. Not out of malice. Out of habit. This is how governance failure looks in practice. Governance Is Not Bureaucracy. It Is Protection. In my advisory work, I position governance as protection — of both the business and the family. A well-designed family constitution is not symbolic. It clarifies decision rights, dividend policies, employment criteria, and conflict resolution mechanisms. More importantly, it creates predictability. Predictability reduces emotional escalation. When families do not pre-commit to processes, every disagreement becomes personal. And once conflict becomes personal, rational capital allocation becomes almost impossible. Professionalisation does not mean removing family influence. It means defining where that influence is appropriate. The Illusion Of The '3 Generation Rule' The widely cited statistic that only around 3 percent of family businesses survive into the fourth generation is often interpreted as proof that multigenerational continuity is unlikely. In reality, the more relevant question is not whether the original legal entity survives, but whether the family maintains governance capability across generations. Some families sell successfully and reinvest into new ventures. Others restructure. Some consolidate assets. Continuity should be evaluated at the level of the entrepreneurial family, not merely the operating company. Families that endure typically share three characteristics: They institutionalize governance early. They separate ownership from management before crisis forces them to. They create structured communication forums independent of daily operations. The absence of these elements does not create immediate collapse. It creates slow erosion. Where Advisors Often Miss The Real Work For professionals working with family enterprises, the challenge is integration. Technical excellence is not enough. Legal structuring without relational alignment simply postpones the conflict. I have witnessed meticulously prepared ownership restructurings collapse in minutes because sibling tension had been ignored for years. No tax optimization can compensate for unresolved resentment. Advisors who operate exclusively within their functional silo risk reinforcing fragmentation between systems. Advanced family enterprise advisory requires systemic awareness — the ability to see identity risk, authority risk, and relational capital risk alongside financial exposure. The Real Competitive Advantage Family businesses are not fragile by nature. They are fragile by avoidance. They rarely fail because of a single strategic mistake. They deteriorate because expectations remain unspoken, authority transitions remain ambiguous, and founders delay conversations that feel uncomfortable. The families that build true multigenerational continuity are not necessarily the wealthiest or the most sophisticated. They are the ones willing to address tension early — before it becomes structural damage. Strategy creates growth. Governance sustains it. Communication protects both. And that, in practice, is where the real work begins.

The family business leaders of tomorrow will need to cultivate a diverse set of skills and competencies to successfully navigate the evolving landscape of business and family dynamics. As these businesses often operate at the intersection of personal relationships and professional responsibilities, future leaders must be adept at balancing these elements while steering their businesses toward growth and sustainability. One of the most crucial skills for future family business leaders is strategic thinking. They need to be able to envision long-term goals and develop comprehensive plans to achieve them. This involves not only understanding the current market trends but also anticipating future changes and preparing the business to adapt accordingly. The ability to think strategically will enable leaders to make informed decisions that align with both the business’s objectives and the family’s values. Adaptability is another key competency. The business environment is constantly changing due to technological advancements, economic shifts, and evolving consumer preferences. Family business leaders must be flexible and open-minded, ready to pivot their strategies when necessary. This adaptability extends to embracing innovation while still respecting the traditions that have been foundational to the family’s legacy in order for the business to adapt and remain relevant in the evolving world in which they will operate in the future. In addition to strategic thinking and adaptability, governance skills are essential for maintaining a well-structured family business. Future leaders should understand how to implement effective governance practices that ensure transparency, accountability, and fairness within the organisation. This includes setting up clear roles and responsibilities, establishing decision-making processes, and creating mechanisms for conflict resolution. Emotional intelligence is another critical skill for family business leaders. Managing family dynamics requires sensitivity, empathy, and strong interpersonal skills. Leaders must be able to communicate effectively, listen actively, and mediate conflicts in a way that preserves relationships while also prioritising the best interests of the business. Emotional intelligence helps in building trust among family members and employees, fostering a collaborative work environment. Furthermore, as businesses become more interconnected globally, having a global perspective is increasingly important. Future leaders should be aware of international markets, cultural differences, and global economic trends. This knowledge will enable them to identify opportunities for expansion and collaboration beyond their local context. Stakeholder management is also vital for family business leaders. They must understand how to engage with various stakeholders, including family members, employees, customers, suppliers, and the community. Building strong relationships with these groups can enhance the reputation of the business and help to ensure its long-term success. Finally, continuous learning and development are crucial for preparing future family business leaders. Engaging in mentorship programmes, attending workshops, and pursuing further education can help them stay updated on industry trends and acquire new skills. By committing to lifelong learning, they can remain agile and responsive in an ever-changing business landscape. The family business leaders of tomorrow must be equipped with strategic thinking, adaptability, governance skills, emotional intelligence, a global perspective, stakeholder management abilities, and a commitment to continuous learning. These competencies will enable them to effectively lead their firms while maintaining harmony within the family structure at the same time.

Trust is a fundamental basis for both cooperation and competitive advantage in family businesses. The words ‘trust’ and ‘business’ written within such proximity may raise some eyebrows. However trust is a fundamental basis for both cooperation and competitive advantage in family businesses. Trust entails the acceptance of one’s vulnerability based on one’s expectations of the way others will behave. This vulnerability is central in many definitions of trust and is the condition of being open to harm, criticism or attack. Gene politics hold the business together through ties of trust, flexibility in decision-making and power in execution. Trust is a multidimensional, complex and dynamic construct that includes an emotional attachment of care and sincere concern. Risk propensity is also an element of trust. It is associated with qualities like consistency, competence, fairness, responsibility, helpfulness and benevolence. Shared trust in family businesses that are governed by fairness and justice emerges from a set of relational ethics that value cohesion and consensus. In family businesses, harmony within the family is characterised by trust and mutual understanding. Family business owners who have difficulties in trusting are characterised by passivity, pessimism and isolation. These types of leaders seldom speak positively of non-family co-workers and are described as paternalistic. On the other hand, family businesses owners who engage in trusting relationships have been associated with optimism and pro-activity. This type of leader embraces involvement of others in the family business. Among other things, these owners are transparent about the rules governing family members’ entry and involvement in the business. Communication, which is indispensable in any form of business, entails revealing oneself, being open to others, trusting, as well as raising issues that might generate conflict. Open communication about difficult issues is vital and this requires trust and willingness to be vulnerable. Family forums, such as meetings and councils, are valuable mechanisms to enhance trusting relationships, to improve communication and prevent and manage conflict effectively in the family business. Consultants and advisers may act as trust catalysts in family businesses by inspiring members and business partners to trust each other. Trust catalysts serve as a reminder of the family glue: they are good listeners, remain calm and put a damper on destructive conflict. Gene politics is a term that is used to describe the ties of blood that run through the family business and the biases such ties bring. Gene politics exists only in family businesses and generates a culture that is capable of motivating, nurturing, integrating and innovating. Gene politics hold the business together through ties of trust, flexibility in decision-making and power in execution. Trust in family businesses provides a means of co-ordination, reduces risk, and may lead to greater investments, and economic efficiencies. Trust enhances performance and long-term orientation. Leaders act on trust and this is especially so in family businesses where shared leadership is the prevalent form of leadership as the business grows through generations. Owner-managed businesses develop into sibling partnership and cousin collaborations demanding an ever-increasing form of shared leadership. In shared leadership there is tacit understanding, intuition and trust between parties. Trust needs to be sustained and nurtured throughout, particularly as the business grows and expands. The incumbents’ trust towards successors, and vice versa, is an important criterion for successful succession. Mechanisms that may lead to trust in the successors’ abilities in one family business may not work in another. To ascertain whether the abilities of the next generation will fit in with the needs of the business, open discussion between owner-manager, potential successors and other family members is recommended. Lack of trust is one of the causes of problematic relational factors that cause conflicts and that obstruct successful succession. Trust is also positively related to the transfer of knowledge in succession that needs to be created, shared and transferred over time to create value to the family business. Interpersonal trust that is indigenous to family businesses stems from common heritage and can be sustained by fostering additional and complementary forms of trust. This additional trust is fostered through openness to outside influence, clear and transparent policies and strong communication. The evolution of trust in family businesses is different from that in non-family businesses. In non-family businesses, relationships, formal contracts and controls are initially used to start business relationships. These are gradually complemented with relationship-based trust. Initially in family businesses, relationships based on trust are central, however, as the business evolves, additional processes that engender competence and system trust become increasingly significant. A recommendation for family business leaders is to juxtapose processes typically linked with control, such as policy formation, with those associated with trust building, such as communication. Sustained levels of trust are key ingredients for emotional capital that is central in the success of every family business. About the Author - Roberta Fenech is an associate consultant for EMCS and also a lecturer at St Martin’s Institute of Information Technology.

Started 30 years ago, Luxasia is Asia’s leading distributor and retailer of beauty products where two of the founder’s children have now taken on roles in the family firm. Luxasia has a string of joint ventures with some of the world’s biggest beauty companies, including LVMH, Coty, Elizabeth Arden and Yves Rocher. The company was started 30 years ago, and now two of the founder’s children work in the firm – his son Alwyn, and his daughter Sabrina. Sabrina Chong started out practising as a lawyer at Baker & Mackenzie but after several years in corporate law, she wanted to expand her skillset into finance. Juggling work and study was already tricky with the long hours as a corporate lawyer, but she wanted to learn the ropes of the business. So when her father offered her the chance to work in the family firm, she agreed and split her time for two years between work at the law firm, the family business and getting her Masters in Accounting. After the two years, she fell in love with the beauty industry and decided to join the family business full time to expand the business. Some family firms are finding it a challenge to adapt and change and embrace the potential of digital technology, but you can’t say that of Luxasia. “We are constantly reminded that we needed to be insecure, especially in a fast-moving consumer goods market like beauty products. Digital is transforming the business model of our industry, and especially the role of the distributor. We have a huge advantage being located where we are because it gives us access to many dynamic markets. Not just China but India and the rest of South-East Asia. We offer international brands a proven platform to reach these consumers who are avid for their products.” “That said, the old style distributors in our region are struggling. So if you don’t adapt, you won’t survive. I believe the answer is to integrate either vertically or horizontally, and we’ve decided we have to do both – increasing our platform geographically and integrating downwards, into owning our customers and channels.” There’s a conventional retail aspect to that strategy, with the upmarket Essentials store chain, but increasingly it’s a digital platform as well. Luxasia has invested in various beauty-related technology companies, strengthened its systems, invested in training and education and upskilled its talent, to enable it to add value to its partners and consumers. Sabrina believes their family business model has actually helped them make these bold decisions. “Things can move at a faster pace in a family firm – proposals can get debated and approved faster, and the board and management work together as one. The beauty of a family business is the trust you have – the ability to be completely at one with each other. We get the whole leadership team together several times a year to brainstorm ideas and challenge ourselves on the strategy and direction. My father is very open to those new ideas – he’s always up to date with the latest technology, and constantly challenging us to come up with new ways of doing things.” So does Sabrina see herself taking over from her father one day? “At the moment, the more important task is getting our teams aligned towards where the company is going, and ensuring that we protect our values as we grow. It’s about who’s best for the job, and that might well be an external leader. The company has always been professionally managed and we are upscaling our teams as we push forward with our expansion plans. It’s about meritocracy – that’s the only way the company is going to be a success. You can’t put a family member in a CEO role unless they’re the best person to take that role.” “But am I ambitious? Of course I am, and I want to leave a legacy for my children. But that legacy doesn’t have to be in the form of the business, because who knows what it will look like in 10 or 15 years’ time. The more important legacy is the values we have as a family –that’s the gift we can pass on.”

Tohtonku Sdn Bhd is a major player in the personal care products sector in Malaysia, and stands out from many other family firms in the region by having made it successfully to its third generation. It was set up in the ‘60s by Lim Joi Him, and in the half century since then has grown its portfolio to over 200 products, some of them market leaders. It’s also a significant regional player, selling all over Southeast Asia including Japan, Hong Kong, Singapore, Thailand, Indonesia, Myanmar, Brunei, Pakistan, and Sri Lanka. Personal care is a particularly fast-moving segment, driven by changes in consumer taste, new fashion, celebrity endorsement, and new product development. Tohtonku’s work in this area is managed by a member of its third generation – Jasper Lim, its Executive Director. “We use some of the region’s best-known celebrities to promote our brands, and we’re always looking for the next big thing and the next important fashion trend. We think our own staff are one of the best resources we have to capture how our consumers are thinking, and we encourage a working environment where new ideas can come from anywhere, not just an office marked ‘Innovation’. And once we have a new brand it’s all about achieving market share, which means clever marketing, and an efficient production operation.” This inclusive culture reflects the values which are important to the family, and which they apply within the business as well. “For us, values are as important as profits – not more important, but equally important. My father cares as much for the welfare of the staff as he does for the family itself. Some of our staff have been here for decades, and many work long beyond their official retirement age, because they feel part of something. We want to contribute positively to the economy and the social welfare of the nation, and we believe our values of humility, trust, growth, and service are the best way to do that.” The same values have helped the family manage its own affairs, especially in an increasingly fast-moving world which is utterly unlike the business environment Lim Joi Him first knew. “I think the secret to our success is that we understand the importance of harmony. There will always be some disagreements among family members, and differences of opinion about the direction we should take, but we give each other the benefit of the doubt instead of immediately passing judgements. We make an effort to clarify and understand the issue before we come to conclusions. We eat and breathe this company – it completely dominates our lives, and that makes us stronger as a family, stronger as a business, because our customers really respond to the strong values and heritage of family-owned firms.” About the piece - This feature forms part of the PwC Global Family Business Survey 2016. It has been reproduced with the permission of PwC.

In today's fast-paced and high-pressure work environments, employee mental health and well-being are not just “nice-to-have” extras—they are essential obligations. Employers in the Republic of Ireland and beyond have a legal and ethical responsibility to support the mental and emotional wellness of their staff. Beyond compliance, fostering a psychologically healthy workplace is simply good business. A mentally well workforce is more engaged, resilient, creative, and loyal. Shift from Productivity to Well-being Too often, the employer-employee relationship centres narrowly on productivity, KPIs, and output. While performance matters, mental health is a performance driver—not a distraction from it. Employers must recognize that workplace stress, unresolved conflict, poor communication, and even external personal circumstances can significantly affect an employee’s ability to function at work. A Supportive Culture A truly supportive work culture acknowledges the whole person—not just the worker. But what do we mean by that? Below, we cover the key elements of a mentally healthy workplace and suggest proactive techniques to help promote well-being within your teams. Key Elements of a Mentally Healthy Workplace 1. Visible Commitment from Leadership Leadership must model positive behaviour, openness, and empathy. Mental health should be discussed openly, without stigma. Incorporate mental well-being into your company values and mission statement. 2. Policies and Reporting Channels Have clear, well-communicated policies that cover: Bullying, harassment, and discrimination. Workplace stress and grievance reporting. Reasonable accommodations for mental health conditions. Ensure employees know how and where to report concerns, including options for anonymous feedback. 3. Training for Managers and Supervisors Managers are often the first point of contact when an issue arises. Equip them properly. Training should include: Mental health first aid. Recognising signs of burnout, anxiety, or distress. How to initiate supportive conversations. Boundaries and confidentiality. Referral pathways (e.g., EAP, occupational health). This is not about turning managers into therapists, but enabling them to respond appropriately and supportively. Proactive Techniques to Promote Well-Being 1. Workshops and Education Regularly hold sessions that cover: Stress management techniques. Resilience building. Mindfulness, breathing, and grounding exercises. Setting work-life boundaries. Digital detox strategies. Interactive workshops can be held quarterly. Guest speakers, such as psychologists or wellness coaches, can provide expert insight. 2. Employee Assistance Programmes (EAP) EAPs provide confidential support for: Mental health concerns. Personal or family issues. Financial stress. Substance misuse. Ensure employees are aware of this benefit, understand how to access it, and that it’s regularly reviewed for effectiveness. 3. Regular Check-ins and Follow-ups Managers should hold 1:1 well-being check-ins, not just performance reviews. Ask open-ended questions like, “How have you been coping with your workload?” or “Is there anything affecting your well-being that we can support with?” Follow up consistently. One-off chats aren’t enough. 4. Culture-Building Events and Relationship Development Human connection at work is protective for mental health. Foster it by: Hosting well-being days with optional activities (yoga, guided meditation, creative workshops). Creating spaces to connect—team lunches, walking meetings, or internal networking events. Starting interest-based employee clubs—running groups, book clubs, music hours, etc. Promoting cross-team collaboration projects to reduce silos and isolation. 5. Flexibility and Customisation Not every solution fits all. Companies should aim to: Offer flexible working options (remote/hybrid hours, adjusted start times). Allow mental health days without stigma. Adjust workloads when someone is recovering from a difficult period. Provide access to private spaces where staff can take quiet time during the day. 6. Measuring Impact and Continuous Improvement Don’t assume something is working just because it exists. Instead: Conduct anonymous pulse surveys on well-being and psychological safety. Analyse absenteeism and turnover patterns. Track EAP utilization (anonymously) and get feedback on its effectiveness. Hold focus groups or listening sessions to gather ideas from employees. Building a Sustainable, Supportive Culture Mental health at work isn’t a project—it’s a culture shift. When employees feel seen, heard, and supported beyond their output, they show up with energy, focus, and loyalty. By considering the points raised in this article and taking steps to implement some of the techniques, you can help play a significant role in creating a supportive workplace for all. Investing in mental health isn’t just a moral imperative. It’s smart strategy. Employers who take it seriously are not just creating better workplaces—they’re building better organisations. Given the complex nature of mental health, there is a shared responsibility among all stakeholders. Be proactive about mental health by integrating supportive practices at every level.

Conflict happens in any enterprise. However, when your co-workers are also your family, conflict can take on new levels of complication and affect both familial and business operations. There are many common sources of conflict in a family business: Everyday spats over business operations, conflicts between older and younger generations over succession or the future of the business, or resentment stemming from feelings that certain family members are being compensated in excess of their productivity can all lead to conflict. Often, working and non-working family shareholders have different opinions about the distribution of business profits or compensation, causing friction that can lead to power struggles that damage business operations. Even garden-variety family drama can blossom into full-blown family crises if they aren’t adequately addressed. We’ve seen many situations where in-laws or partners of family members attempt to exert influence or otherwise involve themselves in the business. The hazy line between business time and family time can mean that family issues are dragged into work and business issues can contaminate family time. Rivalries between siblings or others members of the family can turn ugly when there’s money or authority at stake. Whatever its source, resentment and frustration can eat away at business and family harmony. Many (if not most) family businesses struggle to confront sensitive issues because they want to avoid conflict. The problem is that conflict can never be avoided – only prolonged. The end result is often that small ‘kerfuffles’ turn into major family crises because there was no early intervention. The vast majority of family conflicts can only be resolved through early, direct conversation and a commitment to honest dialogue. In my opinion, successful long-term family businesses: Anticipate conflict and can have productive conversations when they arise. Clearly communicate their values and expectations to each other. Use formal councils or family meetings to address grievances in a structured way. Are willing to actively work at their communication skills and invest in training and guidance. Fortunately, there are a lot of ways to build healthy communication into your family business. First of all, start early and speak often. Sometimes, spotting trouble early and addressing it before the problem grows is enough. Other times, even large problems can be addressed through a series of conversations that tackle small aspects of the problem, rather than trying to solve a big issue all in one go. In my opinion as a family advisor, one of the best places to hash out major issues is at a formal family meeting. This might sound unnecessarily complicated, particularly if family members see each other regularly. However, while your family might be great at discussing everyday business and family matters, it’s very common for families to feel unable to tackle the big issues – the elephant in the room. A formal structure can help families set policies, open lines of communication, and give members permission to bring up big issues. An effective communication structure can also help avoid major conflicts by giving the family space to manage the inevitable issues that will arise in a family business. Mediated discussions can help when a thorny issue simply cannot be resolved internally. Oftentimes, issues have become so large and the relevant parties so entrenched that constructive dialogue is no longer possible. In these situations, an objective outsider who is trained to resolve disputes and negotiate tricky emotional territory can help cut through the drama and focus on the issues at hand. We have found that many clients achieve more in a few hours than they have in the last decade. Family retreats offer the opportunity to get away from the everyday and come together as a family business team while doing something fun and constructive. Retreats can involve all family members, just those who are active in the business, or may include spouses and young adults. What’s important is that you focus on building family ties and strengthening communications. Family retreats are not just events – they should be the start of your commitment to better communication and healthy conflict resolution. Bottom line: Conflicts happen in a family business. Resolving them takes time, honesty, and good communication skills. Ignoring problems never works because if you ignore them long enough they turn into crises that can damage the business and cause your family to suffer. If you’re concerned about conflicts in your business or your ability to resolve them, reach out to an expert. It’s time well spent.

When crisis strikes a family business, advisers need a clear plan, with an emphasis on honesty, to minimise reputational damage Many businesses have been through a tough time over the past few years. Public mistrust of politicians and bankers has spilled over into wider cynicism about businesses generally. The ‘information age’ also means journalists are no longer the only people who tell us about the world; the web allows anyone to assume the role of public commentator. With so much information out there, the noise can be deafening. The writer Linda Stone describes our response to this as ‘continuous partial attention’: we never really focus in detail on anything, but we are always tuned in. For businesses with complex issues to explain, it is often difficult to get a message across to the public. Media Attention Family businesses are confronted with their own particular pressures. Private and inherited wealth have become an increasingly prominent political issue, and, in these times of economic hardship, the tax debate has become heated. Adopting a low profile is seen by some as ‘hiding something’. As for the UK media, its notion of what makes a good story has not changed much in recent years. The mishaps and lifestyles of people always make better copy than the issues of corporates. Significant moments in a family business’ history, such as the death of a founder or the transition from one generation to the next, are analysed as never before. The media has few scruples about the cost of such personal attention. When a crisis does occur, whether the media focus on the family or the business that the family owns, these can be highly stressful times. Close media attention can call into question the management’s values and competence, and cast a critical light on the business. A crisis can erode trust not only between the business and its employees or customers, but also between family members and within the business itself. But how the family or business handles such a crisis is part of the story itself, and can often give that story longevity, long after the original issue is forgotten. Protecting Reputations In one sense, there is no such thing as ‘crisis management’, if that implies media attention can be stamped out through clever public relations. Managing a company and a family through the media storm requires leadership, and a measured and unemotional sense of how the business’ reputation can be best protected. This requires the family business adviser to know the facts and have a clear idea of how to respond to them. Saying nothing to the media is sometimes an option, but, when silence is untenable, the adviser will need a clear idea of what to say. Hiding behind lawyers rarely works. The media, the adviser’s staff and others need to have a clear sense that the affairs of the family business are being managed with confidence, and that the adviser is in control. Reputational damage does not always finish once the media move onto other subjects. Having a long-term plan to address the issues raised by the crisis, and to rebuild trust, is vital. Throughout, advisers need to be mindful of the views of all stakeholders. Understanding the family members’ perspectives and being seen to be sensitive to them will help the adviser to respond effectively and mitigate criticism. Managing a family or business’ reputation in advance of a crisis is the best way for advisers to protect themselves from the consequences of a crisis. Knowing your advocates, knowing your detractors, and making sure the media have a sympathetic view of the family business are all important. None need preclude a family maintaining a low profile, but having some prior information on the issues that might make a family vulnerable, and where the threats might come from, is useful preparation. The most important point in a crisis is that everything said and done must be authentic. Corporate speak is out. Family members and the business managers need to be clear in their own words about what has happened, why it matters and what they are doing to address it. Their values and character should come through in all of their communications to employees, customers, suppliers, media and even regulators. If this is done, advisers will be able to influence and shape a crisis and have a better chance of surviving it. About the Authors - Alex Finnegan is an Associate and Richard Meredith is a Partner at the Brunswick Group. Reproduced with permission from the Society of Trust & Estate Practitioners. For more information please visit www.step.org

Given their portrayals in the media, it might be easy to dismiss family businesses as hotbeds of power playing, favour currying, and back-stabbing—preoccupations that can hurt the company, the family, or both. Think of the Murdochs and NewsCorp, or the Redstones and National Amusements, to name just two. But despite the headline-grabbing tales, many family businesses have enjoyed success for decades, even centuries. For instance, the Italian winemaker Marchesi Antinori, established in 1385, has thrived as a family business for more than 600 years. Similar examples can be found across the globe just within the alcohol business; they include Gekkeikan in Japan (founded in 1637), Berry Bros & Rudd in the United Kingdom (1698), and Jose Cuervo in Mexico (1795). So which is it? Are family businesses prone to dramatic implosions, or are they some of the most enduring companies in existence? The answer is both. They can be much more fragile or much more resilient than their peers. Given that family businesses—companies in which two or more family members exercise control, concurrently or sequentially—represent an estimated 85% of the world’s companies, ensuring their longevity is essential. The United States alone has 5.5 million of these businesses, which employ 62% of the workforce, according to the research and advocacy group Family Enterprise USA. To explain the difference between those two fates, we’ll delve into an area rarely explored in business schools or the media: the impact of ownership on a company’s long-term success. Ownership of any asset confers the power to fundamentally shape it. Think of a professional sports team. Within the rules of the league, the owner has the right to make essentially every important decision, including whether to fire the coach, which players are on the roster, where the team plays, whether the franchise seeks to maximize wins or profits, and whether and when to sell it. The teams with the best track records have great owners at the helm. If your favourite team has an ineffective owner, you are probably doomed to disappointment. The owners of family businesses wield profound decision-making power. We know of sizable companies in which not a dollar can be spent without their approval. In a widely held public company, the owners are mostly investors. Their influence is limited. They typically let the board and management run the business; when dissatisfied, they “vote with their feet” by selling their shares. Ownership of a family business could not be more different. It rests with a relatively small number of people, who are related. Their ability to shape the company is profound and is itself shaped by their relationships with one another. That’s a potent mix, creating the extraordinary highs and lows we see daily in our work advising the owners of family businesses. Five core rights accompany family ownership—the right to: Design: What type of ownership do you want? Decide: How will you structure governance? Value: How will you define success? Inform: What will—and won’t—you communicate? Transfer: How will you handle the transition to the next generation? Understanding and effectively exercising these rights can lead to long-term success. Misunderstanding or misapplying them can destroy what a family has spent generations building. In this article we explore the five rights and offer battle-tested approaches for exercising them well. What Type of Ownership Do You Want? Family businesses are often lumped together as if they were all the same. But four fundamentally different types exist, distinguished by who can be an owner and how owners share control. If you want your family business to last for generations, you need to understand the characteristics of your type and the strengths and challenges associated with it. The choice of ownership type isn’t a mere legal formality; it can define or restrict various members’ involvement and may loom as an unrecognized source of conflict. Sole owner. One family member owns the company and is responsible for all decisions. This works best when the business requires decisive leadership and creates enough liquidity to satisfy nonowners (or when non-business assets can do so). The French cognac maker House of Camus has had a sole owner since its founding, in 1863. In each generation, one member leads the company, buying out siblings’ shares. The current owner, Cyril Camus, says this model has been essential to the firm’s longevity. With no siblings or cousins involved, family conflict around the business is rare. Sole ownership has downsides: Succession becomes a central issue, which may be decided according to merit (as assessed by the current owner) or assigned by primogeniture or a similar rule, and the owner must wrestle with what benefits to extend to other family members. This model can be risky, because much of the family’s capital and talent exit in each generation. Partnership. Ownership is restricted to family members actively working in the business. This allows for multiple perspectives and requires clear rules governing how people can join or leave the ownership group and what benefits accrue to nonowners. The German-Dutch Brenninkmeijer family, sixth-generation owners of the clothing chain C&A, have chosen this type. Children of current owners are admitted to the partnership on a competitive basis, after a rigorous evaluation and an apprenticeship. Like sole ownerships, partnerships keep family owners highly engaged but can be vulnerable to the loss of capital and talent. They are typically more resilient because they don’t rely on just one leader, but they may face conflict over who is admitted to ownership. Distributed ownership . Any family member may be an owner and participate in decision-making. This works well when most of the family wealth resides in the company, when it is mandated by law, or when it is expected by family culture. The Brazil-based conglomerate Votorantim has this type of ownership: In each generation, family members pass down their shares, usually evenly. With no need to buy out nonowner members, distributed ownership can keep family capital tied to the business. But owners may vary in engagement; aligning their interests and defining decision-making norms can be challenging, and resentment about “free riders” may arise if some are operating the business while others are “only” investors. Big problems may crop up if some members of the family want to cash out; having a clearly defined exit ramp reduces that risk. Concentrated ownership. Any family member may be an owner, but a subset controls decision-making. This works well when decisive action is required despite a multiplicity of owners, and it mitigates some of the challenges of distributed ownership. But the question of who will exercise control becomes more complicated with each new generation. Vitamix, the 100-year-old manufacturer of high-performance blenders, operates this way. Shares are passed down to descendants, but in each generation the CEO must own or control a majority of voting shares. Although the owners aim for consensus on big decisions, the CEO makes the final call. One of the chief risks is conflict over who will lead. Another is the possibility that those not in power will lose interest and sell their shares. Although hybrids exist, most family businesses fall into one of those four categories. (If a family business has some shares that are publicly traded, it may fit into any of them, depending on how the family has decided to handle its piece.) In a survey we conducted of family businesses of various sizes and across numerous industries and geographies, we found that 13% had a sole owner, 24% were partnerships, 36% had distributed ownership, and 27% had concentrated ownership. The type of ownership needn’t be a static choice. Be on the lookout for the need to make a change, which may arise when the next generation is joining, when the size or complexity of the business alters significantly, or when you’re bringing in outside leaders. The Antinori winemaking family had a sole owner for 25 generations: Control passed to a male descendant, keeping the business and associated land united. But Piero Antinori, who took the reins in 1966, has three daughters and no sons. He opted for a three-way partnership to succeed him. How Will You Structure Governance? The owners of family businesses wield profound decision-making power. We know of sizable companies in which not a dollar can be spent without their approval. When this power is channelled appropriately, it confers a major competitive advantage, facilitating the nimbleness needed to capitalize on opportunities as they arise. Many family business leaders we know can make big bets at a moment’s notice, without having to run decisions through multiple layers of management and bureaucracy. “Speed of response is becoming more crucial, and we can put large projects to work quickly,” says Alexandre Leviant, the president of the specialty chemical conglomerate ICD, which his father founded in 1952. But if that power is wielded ineffectively, the business will suffer. Some owners exercise too much control, stifling innovation and making it hard to attract and retain great talent. Others step back from major decisions, leaving a vacuum that may be filled by executives looking to their own interests. We saw a number of family businesses nearly destroyed when decisions were left to nonfamily managers who wanted to run the company down and buy it at a fire-sale price. Governance in a family business is all about finding a middle ground between micromanaging and abdicating responsibility, and it becomes more challenging as the family and the business grow. We suggest a simple framework to guide decision-making: the four-room model. Imagine your business as a home with one room each for the owners, the board, management, and the larger family. The owners set high-level goals and elect the board; the board oversees the business and hires (and if necessary fires) the CEO; and management recommends business strategy and directs operations. Because the board and management report to the owners, the first three rooms are in a row, with the owners’ room on top. The family’s room, which is critical for maintaining members’ emotional connection to the business, sits alongside the other three, underlining the importance of family influence and unity throughout. In a well-run family business, each room has explicit rules about who belongs there, what decisions are made there, and how. People’s roles vary from room to room. For example, a nonfamily CEO can run the management room but shouldn’t decide how the owners will use their dividends. Nonowner family members, for their part, can’t walk into other rooms and make decisions. Governance based on the four-room model makes the hierarchy and boundaries clear. Time and again, we’ve seen businesses slide into chaos for lack of a good decision-making process. Too often the problem becomes apparent only after disagreements have begun to destroy what years of collaboration built. At a regional retail chain headed by a family member we’ll call Steve, the lack of governance let his self-described “cowboy” instincts run unchecked, sparking resentment in his sister and his cousin, who were equal owners. Once they all recognized the problem, they turned to the four-room model and created an owners’ council, which Steve was required to consult for decisions of a certain magnitude. That allayed his co-owners’ concerns while forcing him to plan big moves more carefully, and the business—along with the family—got back on track. The four-room model helps owners maintain control over the most important issues and delegate other decisions. It establishes a process for revisiting decisions as goals evolve for the family or the business or both. How Will You Define Success? The owners of a business have a right to the residual value it creates. With that right comes the ability to define success. For widely held public companies, that’s straightforward: They aim to maximize shareholder returns. But few family businesses we know would describe their primary objective in those terms. That’s one of the best things about family ownership: You get to determine what matters most. No outsider can force you to value earnings growth more highly than, say, providing family members with employment, or can insist that you pursue opportunities that clash with your beliefs. Effectively exercising this right can be an incredible advantage in making a business last. It enables a long-term, generational approach that contrasts sharply with public companies’ obsession with quarterly results. But not all families are clear about what they value most. That lack of clarity can trigger battles over priorities, missed opportunities, or a failure to retain talented employees. More fundamentally, if you are unclear about your objectives, you risk losing your raison d’être for being in business together, especially as the company grows and transitions to new generations. Your path may become a dead end. To avoid that fate, you need an owner strategy that identifies concrete goals and sets up guardrails. Goals. These fall into three main categories. You can aim for growth: maximizing financial value. You can seek liquidity: prioritizing a healthy cash flow for the owners’ use outside the business. You can look to maintain control: keeping decision-making authority firmly within the ownership group by avoiding outside equity or debt. There will be trade-offs among these options. You might pursue only one goal, or you might decide on a combination. We have found that for most family-owned companies, this is a “pick two” situation, meaning they prioritize two goals at the expense of the third. That suggests three basic owner strategies—one for each possible pairing of goals, each forming a side of what we call the owner strategy triangle. Growth-control companies — the most common type we have encountered—focus on becoming bigger while keeping decision-making within the owners’ purview. Growth-liquidity companies also seek to become bigger, but they pay out considerable money to the owners and use outside equity or debt or both to keep the engine going—consequently relinquishing some control. Liquidity-control companies are not concerned with rapid growth; instead they hope to produce a significant cash flow for the owners while retaining decision-making authority. We know highly successful family businesses that have chosen each strategy combination. And these are broad strategies; companies can find spaces between them. What’s most important is understanding the explicit and implicit choices you are making about what to prioritize; those should flow from your fundamental values. You should revisit your choices as circumstances evolve, whether because of external factors such as economic developments, industry consolidation, and regulatory shifts or because of internal factors such as generational transitions, family conflict, and changes to senior management. Guardrails. Aligning on priorities is essential. But without concrete ways of measuring performance, it’s just lip service. Guardrails can help ensure that those running the business day to day are directing their energy and resources toward what you as owners care about most. They allow you to delegate decisions more confidently. Guardrails can be financial or nonfinancial. Owners should home in on a small number of financial ones—for example, minimum levels of return on invested capital or maximum levels of debt—and ensure that the company stays within them. Nonfinancial guardrails define outcomes for which owners are willing to sacrifice financial performance. The values informing them are often part of the glue holding the family together and a means of making the world a better place. For example, we work with a U.S.-based family business whose members lost relatives in the Holocaust. It invests only in countries with a high score in the non-profit NGO Freedom House’s annual ratings. Having a clear owner strategy fosters longevity by ensuring that the business accomplishes the owners’ financial and nonfinancial goals. Over the long term, families need an emotional connection to their company; they must be able to say, “We own this because we want to make a difference” or “This represents what our grandfather sacrificed to give us a better life.” Without an emotional connection, owners may be tempted to cash out. What Will—and Won’t—You Communicate? Owners are legally entitled to know a great deal about their business, such as what’s in financial statements, certain organizational records, and ownership documents. And except when they bring in outside investors, lenders, or board members, they are not obligated to share that information with anyone (other than the government). That means they control communication; nothing of consequence can be shared without their permission. How owners exercise this right significantly affects the business’s longevity. That’s because effective communication is critical to building one of a family business’s most valuable assets: trusted relationships. These are often underappreciated, but they help generate three important things: Financial capital : committed owners who have an emotional connection to the business and value long-term performance Human capital : engaged employees and family members, including spouses, who bring their full talents to their work and the family Social capital : a positive reputation with customers, suppliers, the public, and other stakeholders, which can help differentiate you in a crowded marketplace and build partnerships across generations The impulse to keep things private is understandable. Privacy can protect the business and the family from outsiders. But if owners hold their cards too close to the vest, they risk starving the business of its ability to cultivate valuable relationships. A business school professor we’ll call Sophie married into a family with a fourth-generation media business in Asia. Concerned about what she saw as a casual attitude toward innovation, she began asking about the company’s long-term strategy. The more questions she asked, the more information the executive team withheld, until it requested that her husband stop sharing financial reports with her for fear she would “rock the boat.” Sophie became increasingly anxious about whether her children would inherit a business with any value. In the face of the stonewalling, she withdrew, even scheduling vacations elsewhere during the family’s annual reunions. That deprived her children of opportunities to forge relationships with their cousins (and future co-owners), which could have a devastating impact on the business in the years to come. Delaying or poorly planning a transition to the next generation can wreak havoc on the family and the business alike. You need a continuity plan. Early on in the life of your business, communication is likely to be informal, perhaps taking place over meals. As things progress, consider what meetings, policies, functions, or technological platforms could improve your dialogues. Start by aligning on what you will and won’t disclose to each audience. In our experience, owners are often so worried about protecting details regarding their wealth that they fail to think through what they can share to help stakeholders feel connected to the business’s long-term success. Such information might include your owner values and strategy, how decisions will be made, how you think about succession, and your passion for the business. If you decide to keep such information private, tell your stakeholders why. We have seen cases in which the failure to communicate effectively was the single biggest reason for a family business’s demise. We’ve also seen some in which skilful communication pulled the company through tough times. Wield the right to inform wisely. How Will You Handle the Transition to the Next Generation? The final right of owners is deciding how to exit. You can choose who will own the business next, what form that ownership will take (whether shares or a trust), and when the transition will occur. With this right come complex and difficult decisions. What will you do with the assets you worked so hard to build? How will you let go? What roles should members of the next generation play? How should you prepare them? Are the relationships among them strong enough that they can work through decisions together? Delaying or poorly planning your transition can wreak havoc on the business and the family alike. A Boston Consulting Group study of more than 200 Indian family businesses found a 28-percentage-point difference in market capitalization growth between companies that had planned their transitions and those that had not. Family empires may be consolidated or squandered in the transfer of power across generations. To execute a successful transition, you’ll need a continuity plan that maps a path from the current generation of owners to the next. It should address three main challenges: Passing down your assets. Will you keep the same type of ownership (sole owner, partnership, and so on) or change it? Will you transfer ownership all at once or gradually (for example, by giving economic interests to the next generation while retaining voting control)? What tools, such as trusts and gifting, will you use to minimize taxes? Handing off roles . How will you create the glide path necessary for the current leaders to let go? How will you select successors across the four rooms in a way that feels fair and identifies the most-talented candidates? How will you ensure a smooth passing of the baton? Developing next-generation capabilities. What skills will each of the new owners need, whether they actively work in the business or not? How will you help them identify the roles for which they are best suited? How will you create opportunities for them to learn how to collaborate with one another? Transition is a process, not an event—and the more the continuity plan resembles a discussion rather than an ultimatum, the greater the chances of success. The plan can’t simply be dictated from one generation to the next; incoming leaders need to be prepared and aligned. To see what can happen when they’re not, consider the Pritzker family, which built the business empire that includes Hyatt hotels. Jay Pritzker, the leader of the third generation, and his brother Robert gathered the family in 1995 and handed out a two-page document describing their succession plans. It detailed a complex web of trusts created to hold the family’s assets, spelled out when members would receive distributions, and assigned leadership to a triumvirate. It was undoubtedly well-intentioned, but it didn’t work. Just months after Jay’s passing, in 1999, a series of lawsuits began. The family eventually decided to divide its holdings. Oftentimes the biggest hurdle to continuity planning is getting started. When facing pressing concerns in the present, it can be tempting to put off cross-generational conversations that may be fraught with issues of mortality and identity. So put those conversations on your agenda (in your owners’ room, with a designated continuity-planning task force, or through your board) and set some deadlines for them. We won’t sugarcoat the bottom line: Without hard and smart work by the owners, other family members, and employees, family businesses often implode. Much energy is needed to keep the many competing interests from turning destructive. There is no single way to survive, and there are few universal best practices. But by applying the five-rights framework, you can organize yourself for the work that family ownership requires. Ask the members of your business to individually assess your performance against each right. Then share the results and develop a plan that builds on your strengths and shores up your vulnerabilities. Only through such collaboration can you use the power of ownership to sustain your family business for generations to come. First Published in the magazine January/February 2021 by Harvard Business Review Reproduced with permission of the author.

For a family-owned business nothing is more important to an organisation than the nurturing and protection of its reputation. Having a family enterprise is not only a privilege – it’s also a huge responsibility. Unlike many boards of publicly owned entities, due to their personal connection, families have additional emotional investment in their business. They are in it for the long haul to create a legacy for their family. Custodians of valuable assets that provide for their family, and like all assets, its value needs protection. Carl Courtney shares his thoughts. According to the Institute for Family Business there are 4.8m family-owned enterprises in the UK which comprise 85% of all private enterprises. In the most recent figures from 2017, they collectively generated 28% of the UK GDP, amounting to a staggering £18.8 trillion a year. The message is clear – collectively, family-owned entities are big business. Family Firms Protect Their Corporate Reputation Generally speaking, family-owned firms tend to be more careful with their corporate reputation. After all, it’s more than just a business for them. It’s a reflection of their family and represents their place in the world. Successful family firms have the capacity to deliver an ongoing stream of revenue, and in some instances, significant wealth. Family owners see the value in the reputational insurance good Crisis Management brings to the table. Marsh Consulting hits the nail on the head, stating, “A dollar invested in Crisis Management returns $7 in averted costs." Investing In Privacy In my early twenties, when I had just launched my own PR firm, I was introduced to an enormously wealthy entrepreneur of a highly respected, but little-known family business. I pitched to him in his ‘office’ – an entire floor of an office block with only him and his office furniture occupying the space (a surreal sight indeed). I presented all the great ideas I had for getting him and his enterprises a high media profile, and how this would translate into further growth for him. He listened intently, and once I finished, he said he would be very happy to work with me, but my goal was to ensure he was never, ever featured in the media. His resolve was to invest in my services to keep his and his companies’ profiles as low as possible. Unbeknownst to me at the time, this was my first ‘Crisis’ client. Whilst nothing had gone wrong in his business, this hugely successful businessman placed a high value on investing in professional help to protect his reputation, and the reputations of his companies too. By reverse engineering everything I knew about publicity and learning the long-held sound principles of Risk and Crisis Management, I started on the journey of becoming a crisis management expert. Over the years I have worked for dozens of family-owned businesses (some for decades), putting in place systems and a knowledge set that protects the ‘family silver’ and allows them to sleep better at night. Five lessons From Family Business Crisis Management 1. Family businesses have a different, often more patient, perspective. They are more inclined to invest for the long term. This explains their tendencies towards having a crisis advisor – it’s a way of protecting their reputation in the long term. 2. “Experience is the name everyone gives to their mistakes.” – Oscar Wilde When young family members join the business, they usually learn the ropes from the bottom up. This learning period can result in teething problems that make for a good story. The better known the business, the more interested the media is. Contingency planning and the risk register need to reflect this, accordingly. 3. “You need people who can tell you what you don’t want to hear.” – Robert De Niro The term ‘family’ can be synonymous with fear. Non-family employees may have a predisposition to protect the family from bad news. However, this can be catastrophic if a crisis is emerging and available ‘time’ is everything. Training needs to be put in place to circumvent this avoidant, nervous behaviour. Making it clear that the messenger won’t be shot. 4. Trust and loyalty are often the drivers in a family business. Everyone in, or advising, a family business can be seen as an outsider if they’re not family. Trust has to be earned fast to be effective and loyalty is reciprocated. Families value longevity in a relationship and tend to hold onto their advisors once trust has been established. 5. Legacy is hugely important in family businesses. When the time comes to retire, accuracy of media profiles is important. This work needs to be done behind the scenes, and in advance too. Equally, when death occurs, accurate obituaries are non-negotiable. As with dealing with retirement, this sensitive work needs to be written and approved by the family. It bears to remember that age is not a factor here, either. However young the protagonists are, accidents and sudden ill health are, unfortunately, facts of life. Having this aspect of a family’s reputation managed by external specialist counsel is the most expedient method of successfully achieving this. Trusted Advisers Look After Secrets It’s true, family-owned businesses tend to be secretive. Unless their business is listed on the stock market, there’s no need to divulge too much. But being a trusted advisor and crisis counsel means we have to get under the skin of the business to be truly effective. In my experience, once you have proved yourself and deliver what you promise, you will likely forge a long-term relationship and become the sounding board for all sorts of situations. After a long-spanning career in crisis, I’m a bearer of many, many secrets!

Some companies use their status as a family business as part of their brand, while others choose not to. What are the advantages of a family business brand? And is it something you could consider? Michael Gough explains more. 85% of all companies in Britain are family businesses – owned by one or more members of a single family. They employ half of all private-sector employees, making them a vital part of the economy. But you won’t always recognise a family firm when you see it. Foreground And Background Families Take Mary and Doug Perkins. The opticians they founded in 1984 was the first to feature a showroom, and following changes to UK regulation, the first to brand itself and advertise. Specsavers now has 1,978 stores across ten countries. It is still owned by its husband and wife founders, and all three of their children work for the company. It’s a quintessential family business, but you wouldn’t know it from the branding. Others put the family front and centre. Warburton’s have the words ‘family bakers’ in their logo. Their tagline, ‘from our family to yours’, appears in adverts and on the packaging. You can’t miss the fact that Britain’s biggest bread company is a family business. They really want their customers to know that there have been five generations of Warburton’s bakers. It’s central to their brand proposition. Why do some family businesses use it in their branding and others don’t? And what are the benefits of using the family connection? Positive Connotations Research shows that people have very positive impressions of family business, and that highlighting family ownership can be a valuable aspect of a brand. People associate them with trustworthiness and social responsibility. The family connection also has connotations of quality and a focus on customers. It’s not hard to see why. ‘Family’ is a positive word in the English language. It suggests that there are real people behind a company – people who get up and go to work and care about what they do. It gives the business a human face, and that helps to build trust and rapport. Even though you are unlikely to ever meet them as a customer, there is a sense of relationship there, a friendliness and approachability. For multi-generation family businesses, there are the added benefits of longevity, family history, and expertise passed down. In some cases, such as the investment and banking services of Rothschild & Co, there are centuries of tradition to draw on. The value of that heritage is incalculable, provided it can be successfully communicated. Staying true to tradition and adapting to changing markets is an ongoing balancing act for older firms. Plenty of family businesses have faltered by failing to stay relevant, and the strength of longevity became a weakness. That’s one of the reasons we recommend brand reviews and audience surveys from time to time. Emphasise With Care Building a successful brand takes strategy and application. There’s nothing automatic about sticking ‘a family business’ on your letterhead. Neither do you need to roll out the founding family all the time. There’s a balance to strike, incorporating the family into the way that you talk about the business, highlighting it when it’s helpful, and making it part of the origin story. An outside perspective will help to get this balance right, and as a branding agency a large part of what we do is helping clients to focus in on their strengths and distinctives. The family and its story may be one of those things. If you’re a family business, your customers may value that about you. It could help to build a connection with new customers, giving them a sense of who you are and what you stand for. It’s an advantage that you might not be tapping into at the moment. Could you be doing more to highlight it? A good first step would be to research it with your audiences. We ran a survey as part of our work on rebranding the property developer Thornsett. We discovered that their clients and investors really valued the company’s family bond, something the directors had assumed was irrelevant. You don’t know until you ask. About the Author - Michael Gough is the Strategy Director and co-founder of the brand and design agency Sparks Studio. He helps established businesses with rich histories and complexity to re-establish their relevance, to connect with changing audiences and express what matters now. He also hosts the podcast Why It Matters, a series of conversations with leaders who are passionate about something that is at risk of being overlooked.