The National Center for Family Businesses announced its intention to launch a specialized platform to connect businesses with service providers, as a key supporter of the third sector, and to contribute to the sustainability of these enterprises, which employ approximately seven million people, and to provide job opportunities, thereby enhancing their role in the national economic system and in society.
This announcement came during a workshop organized by the Center at the Makkah Chamber of Commerce yesterday, titled “The Institutional Transformation of Family Businesses – The Role of the Family Charter,” aimed at supporting the sustainability and development of family businesses in the Makkah region and strengthening their role in the national economy. The workshop was attended by a number of business owners and interested parties, and discussed the importance of institutional transformation, conflicts in family businesses, drafting family charters, and practical examples of family charters.
Dr. Suhail Al-Tamimi, Deputy Executive President and Advisor to the National Center for Family Businesses, provided an overview of governance and its importance for the sustainability of family businesses, addressing the causes of conflicts in such businesses, with examples from global companies, and the differences between family businesses, public joint-stock companies, closed family companies, and limited liability companies, the forms of conflict and the relationship between owners, managers, and the family, issues of profit distribution, vision and goals, the employment of family members, and the importance of governance for sustainability.
He also addressed the importance of documentation in family businesses to resolve any conflicts that may arise between family members or partners, and establishing boundaries between personal matters and those pertaining to the business, and defining incentives and rewards, as these are among the biggest obstacles to the business operating normally. He noted that causes of conflict include business management, procedures, and differing opinions, adding that a family charter can resolve many of the problems facing the company.
For his part, Dr. Mohammed Al-Ghamdi, an advisor to the National Center for Family Businesses, emphasized the importance of family business governance through a number of initiatives, including a specialized platform, a certified family advisor, a certified mediator for reconciliation and conflict resolution, a specialized consulting center, and another for drafting family charters.
