Family Enterprises

This book compiles the wisdom of experienced leaders of family growth companies and those who advise them, focusing on what works to sustain business success without sacrificing family relationships or control. Each of the contributors is grounded in deep management or professional expertise guiding or advising family-controlled enterprises.

Recognition of the power and importance of businesses controlled by family shareholder groups has grown steadily over the past 30 years. Apologies for working in the family business in the 1980s and 1990s have been replaced by public pride on the parts of leaders of family controlled firms for their enduring growth under family control and contributions to all stakeholders in the enterprise.What has been missing from the business literature is a guide to the processes, structures and interventions that assist family-controlled enterprises to sustain continuity of growth, family control and family harmony. This book compiles the wisdom of experienced leaders of family growth companies and those who advise them, focusing on what works to sustain business success without sacrificing family relationships or control. Each of the contributors is grounded in deep management or professional expertise guiding or advising family-controlled enterprises. And each chapter contains clear, practical advice on how to address issues that challenge family firm leaders and their advisers on a regular basis.This new book demonstrates to members of family shareholder control groups, their non-family executives and members of the boards of directors, as well as lawyers and other long-term advisers, that there are ways to address the emotionally powerful issues and challenges that are specific to family controlled enterprises. Many of these proven solutions to the special requirements of leading family firms have broad global applications, assisting them to grow, without sacrificing their culture or strategy.

Preface 7Richard L NarvaNarva & CompanyPart I. Understanding the power and constraints of family shareholder control groupsEntrepreneurship in family firms: reassessing the fascination with success, failure and succession 11Jennifer HalykCommunications consultantEntrepreneurial family businesses and family entrepreneurs: the unsung heroes of entrepreneurial effort 19Matt AllenBabson CollegeThe entrepreneurial family revisited 27Ramona Kay ZacharyBaruch College, The City University of New YorkWorking with siblings and how to survive them 39Lucio E DanaCreativity in Business Pty Ltd, trading as Family Business DynamicsKosmas X SmyrniosRMIT University AustraliaThriving once the founder has gone 57Doug RauchConscious CapitalismThe power of family 67Shari Wyner NarvaNarva & CompanyConsulting with a clinician 75Adam NarvaPsychologistPart II. Building human capital to lead family controlled enterprisesCharacteristics of centennial family companies 85Ernesto J PozaThunderbird School of Global ManagementUnderstanding paternalistic leadership of family enterprises 101Dorothy Nebel de MelloNebel&Mello Consultores Associados and BI InternationalEffective legal representation of family firm clients 115John L TalvacchiaEckert Seamans Cherin & Mellott, LLCThis is not your father’s HR department 127Joshua A NarvaSonos, IncChallenges facing the executive coach in a family firm 131Sunny Stout-RostronInstitute of Coaching at McLean HospitalPart III. Designing family controlled organisation for growthA practitioner’s guide to transferring a family business from one generation to the next 149Frederic J MarxHemenway & Barnes LLPEffective family governance in entrepreneurial families 159Kathrin Phelan MidgleyPhelan Family Enterprises, LLCBuilding for success: better governance today begets a brighter tomorrow 167Denis ThomasUSALCO, LLCOne family business’s governance journey 177Daniel B HatzenbuehlerE Ritter & CoThe non-executive chair’s role in maintaining and strengthening the culture of the enterprise 189Gareth AckermanPick N Pay Stores LimitedThe role of independent directors in family controlled listed enterprises 205Richard L NarvaNarva & CompanyPart IV. Financing growth and change in family controlled enterprisesShareholder agreements for family controlled businesses: managing the expectations and covering all bases 219Dara BachmanTimothy MalloyMichael L MixellBarley SnyderHow the best family business owners optimise their financial adviser relationship 237David C LintonBigelow LLCChallenges faced by family controlled companies in growing by acquisition 247Simon MordantLuminis Partners affiliated with EvercoreHow to manage the successful disposition of a family firm 255Charles S FradinFormer family business owner and corporate directorFamily enterprises and their real estate 265Janet B FiermanSheehan, Phinney, Bass + Green PAPart VAfterword 283Richard L NarvaNarva & CompanyAbout the authors 285