In India, family businesses represent more than 80 percent of the overall businesses and play a key role in economic growth and workforce employment. Family Businesses in India are making the transition from family-owned-family-managed to family-owned-professionally-managed business houses. However, there are constraints and conflicts that arise out of this transition that impact business, personal and governance practices.
To understand these matters in more detail a ‘By Invitation Only’ seminar was organised for a select number of Family Business Owners. The Workshop was organized by Families and Business (FAB), International Finance Corporation (IFC), Cyril Amarchand Mangaldas (CAM) and Vahura Legal Services. The Seminar was held in May 2016, at the IFC Offices in Delhi.
The Seminar titled “Family Business Governance: Professionalize to Sustain, addressed the key issues surrounding governance of Family Businesses. The key focus of the Workshop was:
- Setting out a general framework to understand the key components of a successful Family Business;
- Succession planning including guidelines to establish sound CEO succession plans;
- Understanding three important elements: The Advisory Board, the Board of Directors, and Independent Directors.
The opening and setting of the framework was done by Jung Zhang, IFC, Country Director. It was followed by a presentation titled Family Business Governance: An Overview with a focus on succession planning and roles and importance of advisory boards and boards of directors. Sanaa Abouzaid, IFC, Regional Corporate Governance Lead for Middle East & North Africa was the presenter. She is the Family Business Governance Expert and Author of “IFC, Family Business Governance Handbook” which has been published and translated into 18 languages.
Sanaa’s insightful session was followed by a presentation titled Family Businesses in India: Good corporate governance and legal perspectives. This session was presented by Rishabh Shroff, Co-Head and Partner in the Private Client Practice at Cyril Amarchand Mangaldas. Rishabh specializes in Family Constitutions and Settlements, Trusts, Wills and Succession Planning.
The participants were then taken through a Case Study: Loyola Family-How not to have board meetings at the dinner table. This session was coordinated by Sanaa Abouzaid of the IFC.
The last session of the Seminar was a Panel Discussion: How to build successful family businesses in India and globally. Sonu Bhasin, – Founder & Managing Partner, FAB - Families And Business was the Moderator. The participants were Sanaa Abouzaid, Regional Corporate Governance Lead for Middle East & North Africa, IFC; Slava Ryabota, Regional Corporate Governance Lead, South Asia, IFC;
Rishabh Shroff, Co-Head and Partner in the Private Client Practice at Cyril Amarchand Mangaldas;
Ritvik Lukose, CEO, Vahura.
The Seminar was attended by 26 invited guests who participated, animatedly, in the discussions during the afternoon.