What are the objectives specific to family-owned businesses?

Family-owned businesses aim to ensure long-term sustainability, maintain family control, and balance family and business needs.

Family-owned businesses have unique objectives that set them apart from other types of businesses. One of the primary objectives is to ensure the long-term sustainability of the business. This involves making decisions that will ensure the business remains profitable and viable for future generations. This often means prioritising long-term growth over short-term profits, which can be a significant departure from the objectives of non-family businesses.

Another key objective is to maintain family control over the business. This can involve succession planning to ensure that leadership of the business remains within the family. It can also involve strategies to prevent the dilution of family ownership, such as limiting the sale of shares to outsiders. Maintaining family control can be important for preserving the family's legacy and influence over the business.

Balancing the needs of the family and the business is also a critical objective. This can be a complex task, as decisions that are good for the business may not always align with the interests of individual family members. For example, a decision to reinvest profits back into the business may conflict with family members' desire for dividends. Therefore, family businesses often need to establish governance structures and processes to manage these potential conflicts and ensure that both family and business needs are considered.

In addition, family-owned businesses often have objectives related to their social and community responsibilities. Many family businesses take pride in their local roots and aim to contribute positively to their communities. This can involve supporting local charities, providing employment opportunities, and acting in an environmentally responsible manner. These objectives can help to build goodwill and strengthen the business's reputation in the community.