Recruitment of managers & board members

Outsiders in the family Business

Obtaining the correct balance of family and non-family professional management is a critical challenge facing family Businesses.

All too often even the largest family Businesses do not have non executive directors on their boards. In a business where many family members are passive shareholders (ie. not actively working in the business) it is important to ensure their interests are appropriately looked after at board meetings.

Not only do non-executive directors serve to protect the interests of passive shareholders, they can add a significant amount of value in their own right, through their business experience and personal networks and provide an independent view point and challenge to the status quo. Non-executive directors can also act as mentors for family managers and help in the development and grooming of younger family members to succeed in the future leadership of the business.

Pay and benefits in a family Business

Some people are not comfortable discussing money in general, let alone when it comes to talking about remuneration terms with their relatives (especially their children). As a result, what relatives should be paid is generally decided on the basis of an ambiguous combination of principles which can generate tensions and inefficiency in the company.

The same can be said of a family firm's remuneration policy, which touch on sensitive issues relating to family involvement in the business.

A problem-solving approach based on the separation of management and ownership would entail rewarding relatives strictly on the basis of business principles. It is important to pay family members a market rate, rather than a family rate, for the job. Pay should be linked purely to the job being undertaken and not linked to shareholding.

Of course there are many methods, but whatever the final policy, the details should be clearly spelled out and communicated so that they are understood by all.

Recruitment of senior managers

BDO have experience in the recruitment of senior professional management with an emphasis on finding professional managers with a sound understanding of family Businesses dynamics as well as the requisite skills for the job.

Recruitment of independent non-executive directors

BDO has a network of board level contacts in the family Business community, from which we can help to source suitable non-executive directors. Not only must such individuals be leaders in their field, with the ability to add value to the business, they must understand the unique aspects of family Businesses, often having worked in one themselves.

HR advisory

We provide a complete range of HR advisory services; we have worked with families on remuneration policies for family members and helped in the creation of appraisal systems for working family members and the business as a whole.