On Friday, February 28, the 5th session of the Family Business Course took place with the presentation of Alejandro Escribá, director of the EF Chair. The session dealt with ‘Government and strategy in the Family Business’.
During the 5th session of the course, Alejandro Escribá listed the strengths and weaknesses that characterize the family business, as well as the challenges it must face in the near future. In addition, he spoke of the importance of having a good governance system to improve management in Family Business. The session was divided into two blocks: ‘Peculiarities of the Family Business’ and ‘Corporate and family governance structures’.
The session began by defining the 4 pillars of the Family Business such as property, control, government and generational continuity. The peculiarities of the Family Business and the possible roles that people adopt are also highlighted: family member, manager, owner and board member.
The students staged a debate to find those positive factors and risks that the family character brings in the companies. In this activity it was pointed out that generally the Family Business has a high level of involvement and confidence, which allows reducing control costs. However, in these companies conflicts of interest, emotional burdens and a limiting control that inhibits scalability usually appear.
In the second part, another group exercise took place to understand the challenges that the EF must face. These are summarized in:
1. Generational continuity
2. Dimension increase
3. Professionalization
4. Innovation and digitization
5. Internationalization
Once these aspects were listed, Alejandró spoke about the importance of having a good governance system that allows laying the foundations for all the parties involved to be heard in an orderly manner. This good government is divided into two areas:
1. Good corporate governance
2. Good governance in relationships between family and business
The session concluded by highlighting as a key aspect the good Corporate Governance system in the Family Business. Finally, some effective governance practices that allow obtaining an objective strategic approach and planning the succession in a planned manner were listed.
