Family Businesses and the War for Talent

The podcast and the article are brought to you by The Better Boards Podcast Series.

Welcome to The Better Boards podcast series, the podcast for Chairs, CEOs, Non-Executive Directors, Company Secretaries, and their advisors.

Every episode is filled with practical insights and learnings from those inside the boardrooms. We discuss what really matters and highlight actionable steps you can take to enhance the performance of your board.

Family businesses represent a significant majority of the European, Asian and US landscape. According to the European Central Bank, 60% of all companies are family-owned businesses. In Asia, family-owned businesses form about 85% of all companies. The figure is quite similar in the US, where the figure is 87%. Yet so much that we focus on in business, governance and search is designed for corporates.

I am delighted to speak with Andreas von Specht, family shareholder and NED of Berenberg Bank, Europe’s second-oldest private bank, and shareholder of Bergos Bank in Zurich. He founded AvS Advisors in 2011, advising privately held clients on succession and family governance. Previously, he built a career in Consumer Goods and was a long-time partner at Egon Zehnder in Germany and France. Having conducted over 3,000 interviews with owners, CEOs, and board members, Andreas champions effective governance in family businesses. He brings deep expertise in recruiting top executives and non-executives, while highlighting pitfalls to avoid in leadership appointments.

Andreas, thank you for contributing to The Better Boards podcast series.

Questions

Let’s jump straight in.

1. You specialise in family-owned businesses. It is not just a topic you chose as a consultant. You grew up surrounded by people who lead family businesses. So, it is fair to say that it is part of your DNA. How has this shaped your thinking in the world of executive search?
   1. What are the nuances of the search process when looking for an executive for a family-owned business?
2. What are the critical competencies of Senior Executives who successfully work for family businesses?
3. Having an awareness of the complexities, and I should add maybe additional complexities, the executive will be asked to manage is crucial. What are these?
   1. What are some of the “missing conversations” that you wish would happen more systematically in these important hires? (Example:  Executive asking about each individual in the family enterprise system, current governance structures in place, and unwritten expectations around things like cars, country clubs, etc.)
4. Lets look at the issues through different lenses ….
   1. For family business owners considering hiring a non-family executive for the first time, what processes should they consider to prepare for such a hire?
   2. For a business executive considering working for the 1st time with a family-owned business, what considerations should they be aware of and what conversations should they make sure they have during the hiring process?
5. We’ve spoken a lot about non-family executives, but not non-family board members. Can you talk about the benefits of integrating non-family talent into board positions?  (Board selection process, Strategy, etc.)
6. What governance structures can families put in place to minimise the negative dynamics executives may be asked to manage? (Family Councils, Supervisory Boards, Rising Gen coaching and development programs, etc.)
7. What three things should our listeners take away from this podcast?