Impact of Corporate Governance in Solving the Challenges Faced by Family Business Transitions: Case Study of Pakistan

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Usmani, Z., & Zafar, F. (2014). Impact of Corporate Governance in Solving the Challenges Faced by Family Business Transitions: Case Study of Pakistan. Innovative Journal of Business and Management, 3(01). Retrieved from http://innovativejournal.in/index.php/ijbm/article/view/579
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Abstract

This research paper centers on the challenges faced in transferring and sustaining the family business to the next generations in Pakistan. Family businesses are mostly Small and Medium Enterprises SME’s and our thought to be the backbone of every economy. This paper talks regarding the increasing number of family business in Pakistan. Family businesses are facing many challenges due to the rising growth and globalization of economies. The way businesses tackle with these challenges can be the reason for their success and failure. By incorporating good corporate governance framework and systems many of the challenges can be eradicated. In this paper, the significance of corporate governance in family owned business is identified. This study looks at the theoretical background of corporate governance and its inculcation in the family businesses of Pakistan. Family businesses play a major role for economic growth in Pakistan. This study aims to emphasize that for a sustainable family businesses and their perpetual growth, good corporate governance must be introduced in such entities. In addition to family owners more non-family employees and managers should be hired in the business, so that business is managed more justly and efficiently without any biasness keeping in mind the business laws and codes. Corporate governance will ensure that FOBs are transparent enough to satisfy its various stakeholders such as supplier’s customers and creditors.

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References

[1] Zareie, M. (2011). The Analysis of Effective Factors on Family Business Transition to the Next Generations in Iran: Strategic Management Perspective . IPEDR, 11, 1. [2] Afghan, N., & Wiqar, T. (2007). Succession in Family Businesses of Pakistan: Kinship Culture and Islamic Inheritance Law. Centre for Management and Economic Research, 7(54), 27. [3] Qurashi, A., Hussain, D. I., Mushtaq, F., & Ullah, A. (2013). The Dilemma of Success and Failure in Family Business: Overcoming Failure and Attaining Success . International Journal of Academic Research in Economics and Management Sciences, 2(4), 163. [4] "Preparing the Transition of the Family Business to the Next Generation." BFF Home. N.p., n.d. Web. 13 Dec. 2013. [5] Indalecio, T. (n.d.). 5 Common Threats to a Family Business. About.com Family Business. Retrieved December 7, 2013, [6] Understanding the Different Types of Owners of a Family Business. (n.d.). BFF Home. Retrieved December 7, 2013 [7] Corporate Governance. (n.d.). Investopedia. Retrieved December 5, 2013 [8] Fudda, M. M. (n.d.). The Corporate Governance Guide Family-Owned Companies . Center for International Private Enterprise. Retrieved December 8, 2013, [9] Corporate transformation: Enhancing the success of family-run businesses. (2013, September 18). The Express Tribune Corporate transformation Enhancing the success of familyrun businesses Comments. Retrieved December 8, 2013 [10] Gardella, A. (2012, April 4). Family Businesses Learn to Adapt to Keep Thriving. Business Day Small Business. Retrieved December 5, 2013 [11] Kazimi, A., Moore, B., & Morris, P. (n.d.). Family Businesses. Deloitte. Retrieved December 8, 2013, [12] Piracha, I. (2012, March 5). Family Pvt Ltd: Most Pakistani businesses 'corporate' in name only. The Express Tribune Family Pvt Ltd Most Pakistani businesses corporate in name only Retrieved December 8, 2013 [13] Qureshi, S., Mian,, S. A., & Rana, A. I. (2010). Bahavioral Characteristics of Entrepreneurs in the Gujrat, Gujranawala and Slalkot Industrial Clusters of Pakistan: A Comparisn of First, Second and Third Generation Family Firms . International Journal of Business and Social Science, 1(2). Retrieved December 8, 2013 [14] Gulzar, M. A., & Wang, Z. (2010). Corporate Governance and Non-Listed Family Owned Businesses: An Evidence from Pakistan. International Journal of Innovation, Management and Technology, 1(2), 124. [15] Bernard, C. (n.d.). Family businesses’ continued struggles with effective succession strategies. KPMG Family Business. Retrieved December 8, 2013

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References

[1] Zareie, M. (2011). The Analysis of Effective Factors on Family Business Transition to the Next Generations in Iran: Strategic Management Perspective . IPEDR, 11, 1.

[2] Afghan, N., & Wiqar, T. (2007). Succession in Family Businesses of Pakistan: Kinship Culture and Islamic Inheritance Law. Centre for Management and Economic Research, 7(54), 27.

[3] Qurashi, A., Hussain, D. I., Mushtaq, F., & Ullah, A. (2013). The Dilemma of Success and Failure in Family Business: Overcoming Failure and Attaining Success . International Journal of Academic Research in Economics and Management Sciences, 2(4), 163.

[4] "Preparing the Transition of the Family Business to the Next Generation." BFF Home. N.p., n.d. Web. 13 Dec. 2013.

[5] Indalecio, T. (n.d.). 5 Common Threats to a Family Business. About.com Family Business. Retrieved December 7, 2013,

[6] Understanding the Different Types of Owners of a Family Business. (n.d.). BFF Home. Retrieved December 7, 2013

[7] Corporate Governance. (n.d.). Investopedia. Retrieved December 5, 2013


[8] Fudda, M. M. (n.d.). The Corporate Governance Guide Family-Owned Companies . Center for International Private Enterprise. Retrieved December 8, 2013,

[9] Corporate transformation: Enhancing the success of family-run businesses. (2013, September 18). The Express Tribune Corporate transformation Enhancing the success of familyrun businesses Comments. Retrieved December 8, 2013

[10] Gardella, A. (2012, April 4). Family Businesses Learn to Adapt to Keep Thriving. Business Day Small Business. Retrieved December 5, 2013

[11] Kazimi, A., Moore, B., & Morris, P. (n.d.). Family Businesses. Deloitte. Retrieved December 8, 2013,

[12] Piracha, I. (2012, March 5). Family Pvt Ltd: Most Pakistani businesses 'corporate' in name only. The Express Tribune Family Pvt Ltd Most Pakistani businesses corporate in name only Retrieved December 8, 2013

[13] Qureshi, S., Mian,, S. A., & Rana, A. I. (2010). Bahavioral Characteristics of Entrepreneurs in the Gujrat, Gujranawala and Slalkot Industrial Clusters of Pakistan: A Comparisn of First, Second and Third Generation Family Firms . International Journal of Business and Social Science, 1(2). Retrieved December 8, 2013



[14] Gulzar, M. A., & Wang, Z. (2010). Corporate Governance and Non-Listed Family Owned Businesses: An Evidence from Pakistan. International Journal of Innovation, Management and Technology, 1(2), 124.

[15] Bernard, C. (n.d.). Family businesses’ continued struggles with effective succession strategies. KPMG Family Business. Retrieved December 8, 2013

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