ISLAMABAD: Islamabad Chamber of Commerce and Industry (ICCI) in collaboration with Center for International Private Enterprise (CIPE) organized a workshop on “Governance Challenges in Family Owned Businesses” which was attended by a large number of business organizations.
Mr. Moin Fuda, Country Director CIPE was the key speaker who highlighted the importance of corporate governance in family owned businesses which was essential to ensure sustainable growth and progress.
He said one-third of Fortune 500 companies were family controlled and family owned businesses played vital role in the economic development in many countries as they contributed 50 percent to GDP and provided 60 percent employment to non-agriculture workforce.
He said many family owned businesses in China, India, Europe and West have developed into conglomerates by implementing the principles of corporate governance but 95 percent businesses in Pakistan could not survive beyond 3rd generation due to lack of professional management..
The lack of professionalism, documentation and transparency, lack of vision and capital were highlighted as the major problems in family owned businesses that impeded their growth. It was stressed that family owned enterprises should try to implement corporate governance that will bring multiple benefits to them as it will help in achieving long-term growth, reducing risks associated with mismanagement besides lowering capital costs.
In his welcome address, Muzzamil Hussain Sabri, President, Islamabad Chamber of Commerce and Industry thanked CIPE for holding this important workshop. He said research studies that the companies having good corporate governance structures always performed better than those with weak governance structures. He urged that every family owned business should establish proper structures to ensure growth as business failures were largely due to poor corporate governance structures.
He hoped that the workshop would benefit the participants as they would be able to understand how best the principles of corporate governance could help them in building strong businesses.
