“Any family that owns a family business must consider where their family business is headed,” says Patricia M. Angus. It seems like an obvious statement, and yet, when asked if their family business has a board, most owners say “no.”
A family business serves three purposes: providing guidance, oversight, and representation of the owners’ interests. The board works as a unified team, setting the company’s course.
In most cases, companies have a board in their governing documents. Take a look at your documents and see if this is the case for you. Sometimes, family business owners cede authority to the founder or influential family members (even if they don’t officially serve on the board). This leads to a governance gap—and if it hasn’t affected your business yet, it will down the line.
To determine who should be on the family business board, how a board operates, and the role of an independent director, read “Your Family Business Needs a Board.”
Read about what you need to know about family business boards here.
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