Corporate Governance
An integrated package of procedures, systems, mechanisms and laws regulating the relationship between stakeholders, performed in a transparent and well-organized manner to achieve excellence in performance and yield benefits to stakeholders through optimal utilization of available resources.
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?
Challenges & Transformations in Applying Governance in Family Businesses:
1
Transparency: Sharing of information regarding the true situation in the company.
2
Considering the family company as an entity with a social and family impact and ensuring confidentiality regarding the company secrets.
3
Increasing family companies' acceptance of the idea of governance based on their stability
and profit growth.
4
The importance of the relationship between the founders and their culture in the eyes of some owners
5
Confidentiality
6
Following up on the estate management operations as a whole and submitting periodic reports to the heirs
Avoid making younger shareholders aware of company details to avoid increasing their demands or divulging official information abroad
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8
Avoid appointing qualified individuals from outside the family to vital or sensitive positions, which may be interpreted as a weakness in the family members and affect their
social status.
Benefits of Corporate Governance:
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
1
2
Increased profits by minimizing operational expenses
3
Expand projects and diversify investments by reducing the expense of capital invested on project level as companies applying governance benefit from financing benefits and other facilities
Mitigate risks to family businesses through proper organization, planning and forecasting
4
Improves the efficiency of resources, enhancing environment and economic development
5
Contributes to family and social stability by improving the family-owner relationship and preventing potential disputes
6
For more details and to provide you with advice about your companies and ways to develop them, we are pleased to communicate with you to provide our expertise through our specialist consultants in the field.