Serving the Family Board

Serving on any board of directors is hard, but in a family-owned business, it’s even harder.

Unlike their public-company counterparts, which focus mainly on increasing shareholder value, family-business boards must act on behalf of stakeholders with multiple and potentially conflicting agendas – for example, co-owners with equal power and completely opposing financial timelines. And because interpersonal dynamics in family businesses are much more complicated, discussions of critical issues like leadership succession, compensation, and the performance of management often become uncomfortable, messy, and emotionally fraught. It’s not unusual for family directors to shy away from them and, when they do, for the independent directors to follow their lead.

However, avoidance doesn’t work. It can seriously undermine the board’s effectiveness. Bringing in outside representation can offer an objective look at the business. Non-family board members can provide valuable insights that can help you re-evaluate the business plan and prioritize areas that need improvement.  Family directors need to take on the hard issues head on alongside outside directors to keep the company moving forward.

 Need help tackling those tough topics? Lovelynn Ivey Consulting can help, call today. 617.774.9567