passion and promise: governance practices to prepare family businesses for lasting success
TRANSCRIPT
Passion and Promise:
Governance Practices to Prepare Family Businesses for
Lasting Success
THE PROBLEM
• A study of the Colombian Superintendence of Societies indicates that family businesses: – Represent 68% of all the nation’s enterprises – Generate 65% of the jobs– Participate in 20% of the exports
Yet,– 90.2% do not have protocols– 89% do not have succession plans.
– Another study shows that the failure of F.B. is caused by the absence of good corporate governance practices:
• Lack of management disciplines • Failure to develop and recruit needed talent• Family conflicts• Inadequate strategic plans • No succession plan
THE SOLUTION• Learning to create a system of governance:
La Familia
La Gerencia
Los Propietarios
Consejo
FamiliarJunta Directiva
La Familia
La Gerencia
La Familia
La Gerencia
La FamiliaLa Familia
La Gerencia
La Familia
La Gerencia
La Familia
La Gerencia
La Familia
La Gerencia
La Familia
La Gerencia
La Familia
Los Propietarios
La Gerencia
La Familia
Los Propietarios
ALLEN BETTIS: FAMILY GOVERNANCE
Five Challenges Business Families Must Meet:1.Develop shared goals – for the company and the
family2.Use outside advice –advisors and board
members to build skills, ask clarifying questions, and moderate tensions
3.Attract and develop the best talent for the job – family or not, learning how and when to step aside
4. Cultivate family practices of stewardship, adding value to the organization and discovery for the sake of appreciation
5. Learn to create and use a strategic process to address and resolve complex issues
RICARDO MEJIA: BUSINESS GOVERNANCE
• Relationship between business and family.• Responsibility and functions of the board of directors.
– The strategy– Commitment with results– Succession planning.
• Independent directors and their importance.• Director compensation.• Functions of the chairman and secretary of the board.• Board committee functions.
Internacional Panel
• Shareholders of Corona, Carvajal, two outstanding companies of USA and one from Ecuador will discuss how they have succeded
• Mr Allen Bettis and Ricardo Mejia will moderate the panel
THE RESULT
• Separation of family emotions and tensions from management of the business.
• Improvement in the business professionalization.
• Strengthening business network by:– Value creation.– Access to Capital markets.– Better business sustainability.– Diversity promotion.