Family businesses often find themselves navigating polarities. For example, how can family businesses strike a balance between preserving a multi-generational legacy and embracing continuous change? These issues aren’t new and are more than likely to persist regardless of the changes that come our way.
To find out how the best family businesses succeed at sustaining their organisations, we at Stewardship Asia Centre conducted a research study of 200 successful and enduring family businesses. From their survey responses, we distilled the following traits of successful family businesses:
- Purpose. These family businesses understand that business is more than just a set of economic inputs and outputs. A family business anchored in its values lends itself to the resilience needed to weather economic downturns.
- Community awareness. Enduring family businesses do not prioritise profit over community needs. More often than not, it’s usually the opposite. As Jamsetji Tata put it, “In a free enterprise, the community is not just another stakeholder in business but is in fact the very purpose of its existence.”
- Long-term view. This trait was ranked the second most important trait an organisation’s leadership could possess, just after trust and honesty.
- Trustworthiness. Successful family businesses understand that trust is the foundation upon which all relationships, professional or otherwise, are built. This trait was also the most desired trait in an employee.
- Adaptability. Enduring family businesses are always looking for ways to improve, upgrade and skill. They know that past successes don’t define their future.
- Social responsibility. Recognising that their success depends on that of others, successful family businesses think it necessary to give back to the communities and environments they operate in and benefit from.
- Care for employees. Family businesses also understand the dependencies that exist within the organisation. The surveyed companies say taking care of employees is first and foremost, trumping even business profitability.
At the heart of these seven principles is the genuine desire and persistence to create a collective better future for stakeholders, society, future generations and the environment. We call this steward leadership.
Steward leaders are guided by the Steward Leadership Compass.
The four values of steward leadership
- Interdependence: View the world as an interconnected system in which your success depends on the success of others.
- Long-term view: Create sustained value for both current and future generations.
- Ownership mentality: Take proactive responsibility to create positive environmental and social impact.
- Creative resilience: Persist to find innovative solutions to disruptive challenges.
Although the values articulated may not be labelled exactly as the four above, enduring family businesses embody the values’ spirit. These businesses further integrate the values with their organisational values and articulate a stewardship purpose, one that aims to create a collective better future.
The best family businesses stay true to their compass, especially in challenging times. Will you be one of them?
Applications for Steward Leadership 25 (SL25) 2024 are now open!
FBA is proud to collaborate with Stewardship Asia Centre as a supporting partner on Steward Leadership 25 (SL25), an annual listing of the 25 best projects of steward leadership excellence in Asia-Pacific. SL25 aims to recognise and celebrate projects by for-profit organisations that have demonstrated resolute actions to drive profitable growth by addressing the very challenges that threaten humanity.
If you are a for-profit organisation with a project creating positive impact on stakeholders, society, future generations, or the environment, we want to hear from you.
Find out more about SL25 and submit your application before 31 March.
