A regional approach
Family Businesses are a distinct contrast to companies on the stock exchange or government-owned organizations. Family Businesses also differ from regular companies because they incorporate ‘the family ingredient’, which has to be specifically managed.
Focusing on family-owned businesses is a global initiative for KPMG member firms. As part of the Europe, Middle East and Africa (EMA) region, Central and Eastern European (CEE) countries are very active in this area. Many KPMG Professionals from CEE countries interact with and stay in regular contact with colleagues across the EMA region; sharing knowledge and experience about the Family Business sector. It’s a forum for exchanging good practices.
Succession and ownership issues
An emphasis was made on succession, sharing broader ideas as to how western economies deal with this phenomenon and if or how companies based in CEE region, which have only 25-30 years of private ownership experience, can benefit from their knowledge and experiences.
In practice this means that many of these businesses are in between the first and second generation of owners, usually they have no developed internal family governance, family employment or remuneration policies. Further these family businesses seldom have an external advisor close to the family and usually have no exit strategies in place in case the family is no longer capable, or willing to continue running the business. In contrast to CEE, some family businesses in the West have been in operation for 200 to 300 years, and these can be huge family businesses, including companies like Wal-Mart, Samsung, Porsche or Auchan, thus their experiences are much richer.
Trust and Proximity
KPMG’s CEE Professionals, see themselves as “family doctors” that can make ‘house calls’ for Family Business clients. This approach means our Professionals not only have to know what services KPMG member firms can provide, they must evaluate what the client’s needs are, and secure an effective team to help the family business achieve their aims.
Indeed establishing a relationship based on mutual trust and close communication is essential since Family Business owners want someone to talk to about their business challenges – not just Audit or Tax issues. As KPMG professionals seek to play closer attention to the family component and the “non-technical” side of the Family Business: family communication, family expectations, family values, family competencies, family dynamics, etc.