This week, Alain Nijs, a partner in Greenille by Laga, discusses the importance of shared family values.
Between mid-January and the end of March 2016, Deloitte EMEA Family Business Centre conducted almost 100 in-depth interviews with future leaders of family-owned companies in 19 countries across the Europe, Middle East and Africa region.
One of the key findings of the survey is that the biggest challenge for the next generation of family business leaders is to maintain and transmit family values. This is no real surprise, as shared family values are indeed essential for successful families and family businesses.
Family values define the family dynamics and ultimately the family's identity, culture and legacy. They bond family members and are crucial for cohesion within the family.
For the family business, the translation of these family values into core business values is generally seen as an important driver for business success. Typical business goals such as growth, innovation and recruiting talent) are reconciled with family goals such as long term stewardship over the family wealth and managing the family's involvement and leadership in the business.
Just as important as having these shared family values, is the process of defining and articulating them and making sure that they resonate with all family members. This needs ample reflection and communication. All family members must be encouraged to speak their mind and to actively listen to each other. Open and respectful communication between family members is a key step in building trust and understanding. It is recommended, at least at the start-up of the process, to have these family sessions facilitated. A well-trained facilitator can guide the family along the emotional pitfalls of the process.
Making family values explicit by writing them down (e.g. as part of the family constitution), makes them even stronger. By formally adhering to these values, all family members can use them as a guide in how to live their own life, integrate them in the education and preparation of the next generation or use them as a compass for important decisions in the family business.
Family values must be kept alive. They constitute a key component of family wealth and at the same time a source of inspiration, motivation and ambition for families and their enterprises. Shared values allow families and their enterprises to grow and flourish across generations and are vital in preserving the family's legacy.
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