Family businesses form the bedrock of economic activity around the world. Family ownership can provide an outstanding foundation for commercial success and long-term growth. Equally, however, the relative lack of external pressure and scrutiny can allow family companies to grow complacent, sclerotic and unable to keep pace with changing times. Likewise, as family businesses expand and enter new markets, and as the reins of control are passed on to the next generation, the skills and experience needed to ensure long-term profitability can outgrow a family’s management skills. One solution is to appoint independent non-executive directors to the board. But the move towards independent non-executive directors is not always easy. Discord can arise where non-executives feel marginalised from key decisions, or where communication between family members and non-executives is not free-flowing.
This paper concludes that the success, growth and well-being of a family business is enhanced not just by appointing independent non-executives, but deploying, motivating and involving them appropriately.