Family-controlled firms in Asia likely to prevail
Family-controlled firms in Asia likely to prevail
MANILA (Reuter): Family-controlled businesses in Asia are
likely to prevail despite competition from multinational and
publicly-held conglomerates, prominent Asian businessmen said
yesterday.
"I believe that the family business is a dominant form of
private enterprise...and will continue to grow and prosper in the
future," Azman Hashim, chairman of the Arab-Malaysian group, said
at a forum of Asian and Pacific businessmen.
He said many successful American businesses were still
controlled by families.
Arab-Malaysian is Malaysia's biggest financial house. The
group is family-owned, while its subsidiaries are mostly publicly
held.
Azman said the perception of family-run businesses as
inefficient and unprofessional was unfounded.
"As the business grows bigger, you have no choice but to run
the business professionally. Otherwise you cannot grow. It is a
natural evolution to get into professional management," he said.
Top-tiered professionals can either be hired or come from
qualified family members.
Michael Tien, chairman of the textile giant G-2000 Group, said
it should not be an issue as to whether the company is being run
by outsiders or family members as long as it is run by competent
and qualified individuals.
"After all is said and done, it depends on how good (a chief
executive) you are," Tien said.
Manuel Pangilinan, managing director of First Pacific Co Ltd,
said Asian family businesses have traditional strengths that help
them succeed in their fields. The Salim family of Indonesia is
the biggest shareholder of First Pacific.
He cited the wide network of relationships that give them
excellent business intelligence, flexible contracting and
geographic reach, good access to capital, strong entrepreneurial
spirit, and considerable flexibility to move into new businesses
and out of existing businesses.
Pangilinan, however, said issues of succession, vulnerability
to family squabbles, and distinction between family interests and
business interests might slow its growth.
"But weaknesses can be overcome with sound strategic planning
and effort to professionalize the business," he said.