Governance in Family Enterprises: Maximising Economic and by Alexander Koeberle-Schmid, Denise Kenyon-Rouvinez, Ernesto J

By Alexander Koeberle-Schmid, Denise Kenyon-Rouvinez, Ernesto J Poza (auth.)

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Sample text

In the past two years, or eight years into the governance-building process, the family council invited three independent directors (the chairman of a large insurance corporation, the dean of a prominent business school, and myself) to meet with the council in executive session. While in executive session, the family council has evolved into the family board of the overall holding company. Standard practice today, per your recommendation to our board as our family business consultant [referring here to Ernesto J.

Did the second-generation brothers have any concerns of their own? The two brothers had some additional concerns. As 50:50 partners, they had learned to work with and accommodate each other, but what would happen once one of them was absent? Would strategic decisions or business operations be blocked or encumbered? Would the suddenly restructured ownership pre-empt a stable and successful succession? Then, in 1997, the acquisition and consolidation of Prodesfarma, another pharmaceutical [company], provided the catalyst for the separation of some assets from the combined company.

Sustainability across an extended period of time is predominantly achieved today by family-owned and familycontrolled enterprises. Zildjian Cymbals, from Norwell, Massachusetts, USA, for example, is almost 400 years old. Founded in 1623 in Istanbul, it is now the world’s largest manufacturer of cymbals. The Timken Company, a specialty steel and bearings company based in Canton, Ohio, USA, was founded by a German immigrant to America, and remains a global powerhouse in its industry, more than 110 years after its founding in 1899.

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