Survey: Room for improvement in family business governance standards

In its “Asian Business Families Governance: Crossing the Chasm for Inter-Generational Change” study, the SMU Business Families Institute (BFI@SMU) found that while 85 per cent of the 102 business families surveyed expect to undertake succession planning within the next five years, only 17 per cent have structures in place to facilitate this process, thus indicating that there is room for improvement in family business governance standards. The study, conducted by BFI@SMU together with Deloitte, surveyed family businesses from countries including Singapore, Indonesia and Taiwan, and aims to examine Asian family businesses and their various strategies, structures, as well as professionalism and effectiveness in their management. SMU Vice President (Business Development) and BFI@SMU Academic Director Annie Koh, who presented the findings on May 26, said that while family governance practices remain in the early stages of development and adoption in Singapore, these practices are insufficient to ensure continuity of the business within the family. Prof Koh added that family members may therefore have to create more systematic channels of communication to further examine governance issues that may be present in their family businesses.