Succession in family business
Is there a significant difference between genders in succession in the family business?
Introduction
The E.U. commission defines a family-owned business as any business in which two or more family members are involved and the majority of ownership or control lies within a family.
The family business context is one of the most important components in the world of entrepreneurship, as according to the family firm institute Family businesses create an estimated 70% to 90% of global GDP annually. To support the statement above, it is needed to mention that, for example, in U.S. a big percentage, that in some cases exceeds the 80% of domestic companies, are family businesses. Moreover, in Europe the majority of domestic companies are defined as small-medium sized enterprises. A large percentage of these small-medium sized enterprises are owned and controlled by families so they can be defined as family businesses. One of the main characteristics of family business is the long term investment horizon that implies the involvement of next generation in the company. The role of the younger generation in a family business is very important for the success and the continuity of the firm across the time. The ability of the family firm to engage the new members, so that they evolve to committed owners, is one of the most important steps of success of the family firm. For that reason the commitment, the involvement and the identification of that members in the family business is crucial and, at the same point, is a prerequisite to create meaningful contribution in it. On the one hand, it is well-known that the family business context offers a safe environment for next generation family members, because there are plenty of resources for them to find a good balance in their life between work and family and at the same time exercise their skills under the umbrella of their parents. On the other hand, things are not always going well for the next generation, who is going to
Introduction
The E.U. commission defines a family-owned business as any business in which two or more family members are involved and the majority of ownership or control lies within a family.
The family business context is one of the most important components in the world of entrepreneurship, as according to the family firm institute Family businesses create an estimated 70% to 90% of global GDP annually. To support the statement above, it is needed to mention that, for example, in U.S. a big percentage, that in some cases exceeds the 80% of domestic companies, are family businesses. Moreover, in Europe the majority of domestic companies are defined as small-medium sized enterprises. A large percentage of these small-medium sized enterprises are owned and controlled by families so they can be defined as family businesses. One of the main characteristics of family business is the long term investment horizon that implies the involvement of next generation in the company. The role of the younger generation in a family business is very important for the success and the continuity of the firm across the time. The ability of the family firm to engage the new members, so that they evolve to committed owners, is one of the most important steps of success of the family firm. For that reason the commitment, the involvement and the identification of that members in the family business is crucial and, at the same point, is a prerequisite to create meaningful contribution in it. On the one hand, it is well-known that the family business context offers a safe environment for next generation family members, because there are plenty of resources for them to find a good balance in their life between work and family and at the same time exercise their skills under the umbrella of their parents. On the other hand, things are not always going well for the next generation, who is going to
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