NewProfessional help can support successions in family-run businesses
Heads of family-run firms have several options when faced with future management uncertainty
Many family-run businesses fail to have smooth successions because the founders are not willing to hire professionals to help run their businesses, says a veteran private banker.
Andrew Sum Lok-chung, a managing director of the greater China region for Barclays, said that while there were many options for wealthy customers to choose to keep their businesses running, the heads of family-owned businesses usually refused to accept alternatives to their children taking over.
"Many founders or heads of family-owned businesses tend to stick to the most typical option of allowing their children to continue to run the business," Sum told the South China Morning Post in an interview. "If their children are not interested in running the business and have their own career plans, there are no successors. Some family businesses have been forced to be wound up. This is a shame as this can be prevented if there is good succession planning."
Sum said this was a problem faced by many mainland private enterprises where the founders wanted to leave a legacy in the form of the business.
These entrepreneurs are usually in their 40s to 50s and they have young children who have studied overseas.
"Some of these children have adopted Western culture and some opt to stay overseas or develop their own careers. They refuse to take up their parents' businesses," Sum said.