Establishing Governance structures is critical for any business. In Family Businesses, with the added intricacies of Family relationships and Business challenges, it is most important that strong and accepted Governance Structures are put in place. Instituting and maintaining good Governance is vital for both Family and Business as it allows them to rely on a tried and tested system with sufficient checks and balances.
- We design a Family Business Governance Framework that facilitates
- Participation of both working Family Members and non-working Family Members
- Setting up Forums to discuss Family and Business matters
- Assignment of Office-bearers, their roles and responsibilities
- Forum meetings
- Adherence to compliance
- Decision-making and Accountability
- Transparency and fair implementation of decisions taken
- Efficient and effective functioning of the Family Business
- Succession Planning
Family Constitution Development
- A significant overlap exists between the Ownership, Business and Family space in a Family Business ecosystem. This overlap gives rise to 7 distinct segments. One of the most predictable problem in a Family Business is when an issue or concern from one space (for example, an ownership issue) arises in the wrong segment.
- As the Family Business evolves and Successive Generations enter the Business, several changes occur. The number of individuals with Ownership interest in the Business increases and their expectations begin to diverge. There is also an increased financial and management
pressure on the owners.
- A Family Business Constitution is a quasi legal guide that helps define how the Family interacts with the Business and each other as shareholders.
It is a document that addresses policy, practices and procedures for Family Behavior, Decision‐making, and setting up the road-map for Succession from one Generation to another. It sets up a Framework and a forum for a group of equals to deliberate issues, create policies and procedures, clearly define Family Member’s rights and obligations, and make decisions on important issues. Drawing up a Family Constitution is a method to achieve better connect and infuse the Values of the Family into how the Business is operated.
- We help
- Develop a Family Constitution
- Identify Objectives, Processes, Authority and Responsibilities
- Smooth functioning of Governing Forums
- Conduct Family Retreats to reinforce relationships
- Finalize the Constitution
- Setting up Systems, Controls and Review processes
- Establish a process in place to make Periodical amendments / revisions
- Support Implementation
- Policies, when not explicit, can be interpreted by Family Members in their own way, thereby increasing the chances for misinterpretation, misleading information, and miscommunication. However, drafting and documenting clear cut policies in advance after thorough discussion with all the Family Members, helps avoid problems and conflicts before they happen.
- We formulate various Family and Business policy guidelines which will
- Be based on the Family’s Values, Philosophies and Principles
- Ensure Transparency and Avoid future Discrepancies
- Enable an Informed and Inclusive Decision-making environment
- Bring Professionalism in all aspects
Developing a Code of Conduct
- All Families and Business organizations should have clearly defined, accepted sets of behaviors that their members have to strictly adhere to.
Such codes help avoid deviations from the norms, and build smooth relationships.
- Code of Conduct also helps build Organizational Systems and Practices.
- We direct Families to develop and practice their Family and Business Code of Conduct that address issues such as:
- Information Sharing
- Conflict Management