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KPMG Private Enterprise and the Successful Transgenerational Entrepreneurship Practices (STEP) Project Global Consortium teamed up in 2019 with one goal in mind: to provide family business leaders and business families in Ireland and throughout the world with practical insights and guidance for sustaining the growth and vitality of their businesses.

We recognise that family business leaders benefit from hearing each other’s stories, and as part of our collaboration with STEP, are introducing a new four part article series where we profile family business leaders from around the world who were gracious enough to share their insights and experiences with us.

The first article titled “The courage to choose wisely: why the succession decision may be a defining moment in your family business” is co-authored by Tom McGinness, Global Leader, Family Business, KPMG Private Enterprise, and Andrea Calabrò, Global Academic Director of the (STEP) Successful Transgenerational Entrepreneurial Practices Project Global Consortium. The article highlights insights from 33 personal interviews with family business leaders, including Michael and Gabriel Hoey, the current fourth generation co-owners and leaders of Ireland’s Country Crest, regarding the decision to choose the right successor at the right time to help them sustain their business.

The second article, “The power of women in family business: A generational shift in purpose and influence”  takes an up-close look at the demographic shifts that are changing the role of women in family businesses, the value that women contribute, the various forms of influence they have and the unique competitive advantages they can deliver. Encouraging studies have examined women’s changing roles over the years. However, studies that examine the role of women in family businesses are sparse and fragmented. Various scholars have indicated the need for more systematic and extensive research into the factors that are affecting women’s involvement, leadership, and performance in family businesses.

Key insights include:

• The innate characteristics of women as nurturers and caregivers can translate to a role as “chief emotional officer”, adding to the success and perpetuity of the family business. Their presence brings additional resources that the family business can capitalise on.
• Women have unique and transformational leadership styles and skill, judgment and an outlook that makes them holistic managers and leaders.
• Women in family businesses are continuing to work on role conflicts to pave their own path in the business and the family and resist being designated only as the family caregiver.
• It is not possible to grow a family business with a leadership team that is made up exclusively of men or women.

The third article in the series, Creating value through good governance: How to balance what is right for the business and for the family examines the many layers of family governance and how the evolving principles of good governance create value for the business and the family. Key insights include:

• The family governance value proposition: While business governance is essential for effective business processes and establishing control mechanisms, family governance processes and structures serve a different purpose. Not only do they help to support a strong communication environment among family members, they also help to define who the family is and what they want to achieve together.
• Governing with intent: By its very definition, the controlling family is a driving force for deciding how the business chooses to operate and how it will define success. Often these choices are based on the shared purpose of the family and the business.
• Making governance fit for purpose: There is a gradual shift away from being ‘family-owned and run’ to ‘family-owned and non-family managed’. This makes it necessary for governance structures to adapt to a new scenario in which family members are primarily owners, and not involved in running the business.
• The mechanisms of family governance: In addition to customary corporate governance systems, families in business have the opportunity to build their own unique family governance systems to balance their economic and family-centric goals and translate them into a shared vision for the family.
•  Investing in the family’s most valuable asset: Families have an opportunity to secure the futures of their businesses by investing in their most valuable asset – the next-generation family members who will lead them forward. By applying their family governance systems to create learning opportunities, families are able to provide coaching and mentoring options to next-generation members.
• Family first or business first: Various factors affect decisions about engaging non-family members as managers – or even leaders – of the family business. When the family perceives advantages in engaging professional management for the sustainability of their business, it is typically based on a fundamental decision to put ‘business first’.

This fourth and final article explores The enduring legacy of family business: Uniting business purpose and family values and the important role that legacies play in uniting the core purpose of the business with the family’s abiding values. Our insights are derived from the findings of the STEP 2019 Global Family Business Survey and the first-hand experiences of multiple generations of family business leaders globally.

Family and legacy go hand in hand and most families in business have a desire to connect and contribute to sustaining their legacy across the generations. One way we do this is by sharing and maintaining the things we value, such as important traditions, milestones, personal histories and the family’s beliefs and principles. In family business, legacy is the connective tissue that binds the core purpose of the business, the family’s values and meaningful achievements across multiple generations. It represents both tangible and intangible assets: the financial worth and the social and emotional value that the family has accumulated.

If you would like to discuss the article's findings or for further information about the series, or how we can help, please do not hesitate to contact our Private Enterprise team below.

Thank you to the 26 academic institutions globally who conducted in-person follow-up interviews with family business leaders and developed ad-hoc case studies, adding depth and context to the research findings presented in the four co-authored articles.

The Successful Transgenerational Entrepreneurship Practices (STEP) Project Global Consortium 2019 Global Family Business Survey (PDF 19.9 MB) was planned and developed through a strategic alliance with KPMG Private Enterprise. More than 1,800 family business leaders throughout the world participated in the survey, which probed how family businesses are dealing with succession and governance challenges in light of changing social demographics. It provides a first hand perspective on the opportunities and challenges that lie ahead for the next generation of family business leaders with practical guidance for continuing to build and sustain their businesses.