Family businesses: the unique dynamics of family, ownership and business
Family businesses are the backbone of the economy, not only in the Netherlands but also throughout Europe. They make a crucial contribution to innovation, employment and prosperity. More than other companies, they are focused on long-term sustainable development. They do not operate with the money of anonymous shareholders, but with the family’s capital; their thinking is generational rather than quarterly. Locally or regionally rooted, they are active in national and international markets. Family businesses are characterized by interaction – and sometimes tension – between family members, owners and the business, each with their own roles and expectations. The well-known three-circle model for family businesses clearly illustrates this dynamic:
The interconnectedness of the various interests in the three spheres is both the unique strength of, as well as the unique challenge for, a family business:
- The management of the company is responsible for the growth and profitability of the business;
- The shareholders are focused on the preservation of and return on their equity;
- From the family’s perspective, there is the long-term interest in harmonious relationships, with both attention being paid to individual needs and requirements and the safe transfer of the company to the next generation.
The challenge for all those concerned is to find a balance between the potentially different interests and expectations. At Meijburg & Co, we take these various perspectives into consideration in our advice in order to connect together the performance of the company, the continuity of the family assets and the family interests.
In our work with families and their businesses, Meijburg & Co believes in a personal, comprehensive, results-oriented approach to these issues, whether this concerns the tax consequences of the emigration of a family member, a holiday home abroad or the strategic structuring of the family assets in terms of diversification and risk management. We deal with these issues, both in the Netherlands and internationally, through our network of 155,000 staff in 155 countries.
With Family & Business, we aim to develop a long-term relationship with the current and future owners of family businesses that span several generations. We want to be more than a specialized expert; we want to continuously assist you as a trusted advisor, because it is the people that make the difference; this has been the case at Meijburg & Co since 1939.
We think it is essential to address the various dimensions of family, ownership and business when dealing with a number of essential topics: