Family company Boards must create and maintain strong succession plans that consider both internal and external talent, as well as development plans for potential successors—and do all this while balancing the values and priorities of the family with the demands of growing and sustaining a business.

Managing family relationships at work is one of the thorniest issues in family-owned businesses, particularly when relationships cross generations (e.g., parent-child or uncle/aunt-nephew/niece). Many family members are committed to professionalism and strive to separate work and family in their dealings with each other. However, simply decreeing such a separation between work and family is not enough.Both family leaders and the rising generation have work to do to ensure cohesion on a familial and business basis.

Unlike their public-company counterparts, which focus mainly on increasing shareholder value, family-business boards must act on behalf of stakeholders with multiple and potentially conflicting agendas – for example, co-owners with equal power and completely opposing financial timelines.

How family businesses can overcome egos and internal conflicts to find their next leader--and put a succession plan in place before it's too late.

Families that control an enterprise over multiple generations have a lot more to consider than the average business owner. Egon Zehnder's Jennifer Pendergast shares how families should approach selling their business.

At Egon Zehnder, we have worked with family businesses around the world since our founding in 1964. We interviewed scores of family executives to better understand their sources of success—as well as their pain points.

“Good governance is key to long-term success, especially in family-owned business, where stakeholder relationships are often complex,” says Sonny Iqbal, co-leader of Egon Zehnder’s Global Family Business Advisory.

Did you know that the majority (80 percent) of corporations around the world are family-owned? Yet only three percent continue operating beyond the fourth generation.

One of the fundamental challenges of any family business is maintaining the balance between “family” and “business.” Within the owning family, there will be the same complex, interpersonal dynamics and conflicting aspirations and priorities that occur in any other family.

There is hardly any major Chaebol in South Korea that has not been rocked by a ‘war of princes’ during leadership succession. Notably, the one group that should be involved that is kept in the dark from this is the professional management.