It is clear that family businesses are a major player in society, a large employer, and an economic force. They remain the bedrock of the Maltese economy and are vital to its success.
A successful business transfer takes place when “the skills and the desire to be in business” are transferred from one generation to the next (Shrapnel, 2014, p.7). In light of the increasing number of family members with each new generation, each having different expectations, family wealth can be easily squandered, unless managed properly. This would mean that the hard work of past generations is lost.
Transference of interests in family businesses is an inevitable path such businesses must cross. It is a challenging time for such businesses as family relations converge with business interests with the result that family members must strive to keep a balance on both fronts for the continued success of the family relations and business interests.
Over the past few months, the Malta Employers’ Association has organised a number of outreach initiatives which have been well received by employers.
An important part of the planning lies in bringing together the wishes of the patriarch and the aspirations of the next generation.
Succession Planning may be one of the most challenging experiences facing any Family Business owner, so it is crucial to get it right. For a Family-owned business, a solid succession plan can drive the growth of the business, manage taxes and set the stage for retirement. Succession Planning is a multidisciplinary process.
Dr Chris Cardona, explains how this scheme will not only benefit local family businesses but also our economy. This act will give guidance to how a family business should regulate itself, benefitting from these new incentives, and restructures itself, in order to prepare for the eventual transfer and succession of the business when the moment comes.
To travel on a journey with others requires a mutual respect and understanding. A preplanning dialogue seeks to generate a relationship that will be the foundation of positive communication, growth, and agreed upon direction. If there is agreement that the relationship is a good fit, a proposal would be developed outlining the process, timeline, and milestones. There is no one size fits all prescription for families or organizations; what is required is the ability to ask the difficult questions and raise the issues that are sensitive, yet must be discussed.