Family Businesses

Family Business constitutes world’s oldest and most dominant form of business organization.

Family Businesses range from small and medium sized companies to large conglomerates that operate in multiple industries and countries.

A family business refers to a company where the voting majority is in the hands of the controlling family including the founder(s) who intend to pass the business on to their descendants.

It has been the aim of this committee to prepare independent recommendations that would assist family

firms in actively developing their own well-functioning corporate governance. This recommendation utilise

the unique characteristics of family firms in the best possible way to benefit the needs of both the owners

and the company.

Publicly quoted family firms should follow the corporate governance codes for enlisted companies in

Finland specified by the Securities Market Association. These codes guide publicly quoted companies to

govern business in a legitimate and transparent manner. Even the largest unlisted family firms follow in

many ways the codes for publicly quoted companies. For unlisted companies, the Central Chamber of

Commerce has published a toolkit for developing their corporate governance

The success of family firms is dependent on their owners. Owners who are unanimous about the direction

and means for developing their firm, and who select the best representatives from among themselves and

external professionals to the firm’s administration, are able to run profitable and successful family business.

Controversies, uncertainties, and diverse expectations among the owners will dissociate and weaken the

business, family and ownership. Good corporate governance offers a clear, concrete tool to commit all

stakeholders of the firm and to ensure their responsibility in their own activities. Majority owners who are

capable and active are undisputed resources for family firms, though supportive and reliable minority

owners are also crucial for the existence and continuity of family firms.

Family businesses range from small and medium-sized companies to large conglomerates that operate in

multiple industries and countries .Some of the well-known family businesses include: Salvatore Ferragamo,

Benetton, and Fiat Group in Italy; L’Oreal, Carrefour Group, LVMH, and Michelin in France; Samsung,

Hyundai Motor, and LG Group in South Korea; BMW, and Siemens in Germany; Kikkoman, and Ito-

Yokado in Japan; and finally Ford Motors Co, and Wal-Mart Stores in the United States.

We provide a wide range of specialized advisory services designed to help strengthen companies by improving corporate governance.