All Family-Run Businesses Need Advisory Services
According to the ancient prophecy, the first generation builds, the second generation develops and the third general destroys. However, what is considered a common cliché has proven to be a difficult and painful reality for most family businesses, most of whom do not survive the transition to the next generation.
Family-run businesses are a major factor in all modern economies. Some of the most dynamic, creative and developing businesses throughout the western world and in Israel, as well as the oldest and most stable businesses, both private and public companies alike, are owned and run by families. Over the past years, basic and consistent research has developed to identify the processes characterizing family businesses, to plan ways and means for exhausting the unique potential inherent in them and to increase their chances of survival.
Family-run businesses have similar traits – flexibility and unfamiliarity in decision making processes, focusing on the long-term, pride in the family heritage and commitment to the success of the company. At the same time, one can identify common problem there – harshness and introversion, reluctance to introduce changes and a tendency to emotional impacts. All of these have a negative effect on their ability to adapt and often also on the force of attraction to next generation relatives, and their survival in the long term.
BDO Israel strives to take part in developing advisory services, study and training seminars for the various stakeholders in family-owned businesses – the founders, adult generation, young generation, salaried managers and outside directors.
Diverse professional advisory services for families
- Inter-generation transition – overseeing the comprehensive inter-generation transition, integrating family members and offering solutions to any issues of relevance to the business and family.
- Family contract – creating a set of rules, arrangements and institutions for managing the business and family wealth.
- Corporate governance in the family business including setting up a family-run board of directors.
- Assimilating management tools – planning, budget, control.
- Settling disagreements and disputes, and managing crisis situations
- Developing remuneration systems for family members – salaries, bonuses, options (phantom), shares.
- Share distribution and transfer to family members.
- Change of corporate structure
- Planning retirement – administrative and financial aspects
- Disposal of the family business – making decisions, preparing the business, valuations and presentations, locating a buyer, assisting with the transaction
- Shareholders representation on the board of directors
- Wills, inheritances and property settlements
- Family wealth – (family office, "fund for next generations", trusts, overseas bank accounts,
- Training the next generation – imparting knowledge and management tools to young members active in the family business or intending to join it in the foreseeable future
Trainings and Seminars
- Family seminar – introductory meeting on general business and family-run issues, for one, multiple generation family, including people who are not active in the business (spouses, offspring, etc.).
- Study courses for families – a series of inter-disciplinary meetings on management family and legal issues, intended for family members active in the business and holding management positions.