Family Business Governance
Governance is essential for family owners who want to preserve their family wealth. Governance systems help achieve the sustainability and growth of family businesses across generations, and contribute to the fair distribution of wealth. Governance must be implemented in ways that take into account the privacy of ownership, family culture and work environment, and are in alignment line with the interests of all stakeholders.
Who are the parties when applying governance
Stakeholders
All those who have interests inside or outside the company, such as employees, creditors, customers, and supplier
Board of Directors
They represent shareholders and other key stakeholders, They represent shareholders and other key stakeholders. Their major duties and responsibilities include: Establishing policies and procedures, monitoring management performance, and preserving owners’ rights
The Owners
They own the capital and their investment is expected supposed to return regular profits in line with the size of their investments operating in similar industrie
The Management
Responsible for operations and maximizing profits and benefits for the benefit of relevant parties, especially owners
// Challenges & Transformations in Applying Governance in Family Businesses:
01
Transparency
We ensure the sharing of accurate and complete information about the company’s true situation, building trust among heirs, stakeholders, and family members.
02
Confidentiality with Social Responsibility
We treat the family company not only as a business entity but also as a social and family institution. While protecting its secrets with utmost confidentiality, we recognize and uphold its social and family impact.
03
Governance for Stability and Growth
We promote the adoption of sound governance practices in family companies, which enhances stability, strengthens trust, and ensures sustainable profit growth.
04
Respect for Founders’ Vision and Culture
We emphasize the importance of the founders’ values, traditions, and cultural legacy, ensuring they remain central to the company’s identity and long-term vision.
05
Confidentiality in Estate Management
We maintain strict confidentiality while following up estate management operations and provide periodic reports only to heirs and authorized stakeholders. This helps protect family privacy and business integrity.
06
Protection of Sensitive Information
We ensure that younger shareholders are shielded from unnecessary company details to prevent unrealistic demands or the unintentional disclosure of sensitive information abroad.
07
Prioritizing Family Leadership
We advise against appointing outsiders to vital or sensitive positions, helping preserve the family’s leadership role and protecting its socialstanding and reputation.
// Benefits of Corporate Governance:
Ensuring Continuity and Sustainability
Establish family councils, separation between ownership and management, setting performance indicators and resorting access to highly-qualified personnel in providing assistance to ensure the continuity and sustainability of family business
Expansion and Diversification
We support families in expanding projects and diversifying investments by applying strong governance practices. Through effective governance, companies benefit from financing advantages and special facilities, which reduce the overall cost of capital at the project level and enhance long-term growth.
Risk Mitigation and Planning
We help family businesses mitigate risks by ensuring proper organization, strategic planning, and accurate forecasting. This proactive approach safeguards assets, strengthens resilience, and ensures the long-term stability of the family enterprise.
Family and Social Stability
We contribute to family and social stability by strengthening the relationship between the family and business owners. Through clear structures and governance, we help prevent potential disputes and foster harmony, ensuring unity across generations.
