Business Adviser

KPMG Enterprise is spreading the news

By Grant Walsh
Director, KPMG Enterprise Centre for Family Business

KPMG Enterprise has taken the lead in serving its family business clients and the rest of the world is paying attention. A number of countries have expressed an interest in knowing more about how to assist family enterprises in managing their unique challenges and opportunities all with the goal of growing value in the business and safeguarding family harmony in the process. KPMG Enterprise is now spreading the news abroad to other countries.

Based in Ottawa, Ontario, guest speaker Grant Walsh, director and founder of KPMG Enterprise Centre for Family Business offered this advice to the audience at the Family Business Succession Planning Breakfast Seminar. The two-day seminar was a joint effort between KPMG and Republic Bank and took place on July 25, at the Crowne Plaza, Port of Spain, Trinidad and on July 26, at Cara Suites, Claxton Bay, Trinidad. The seminar was also held in various other territories in which Republic Bank operates such as Barbados, Grenada and Guyana.

Walsh revealed much of the little-known facts about Family Business Succession. He drew attention to the fact that family owned businesses, as the true backbone of global economies are real examples of successful entrepreneurship that have stood the test of time. However, they continue to struggle in their efforts to transition the family business to the next generation. The proof of this, according to Walsh, is that we are still living with the same dismal family succession statistics that were first published over two decades ago, indicating that 70 per cent of family businesses will not make it to the second generation and an astonishing 90 per cent will not make it to the third. One of the reasons cited by Walsh, for such alarming family succession statistics, was that too much attention is being paid to the technical component of succession planning, e.g. tax minimization, family trusts, buy-sell agreements, wealth management, etc; and not enough is being paid to the people or the non-technical component or as Walsh calls it, “the family component”. That is, family communication, family expectations, family values, family competencies, family dynamics, etc. in the succession part of the process.”

Over the past few years, KPMG Enterprise has shared its family business knowledge (The Business of Family Business) with other interested parties including presentations and family business forums in New Zealand, Australia, Bermuda and the UK with scheduled events to be held in several other countries over the next several months.

The issues facing family businesses are universal which is clearly confirmed from the feedback received from family businesses abroad and it’s nice to know that other countries can benefit from the experience developed in Canada. As KPMG Enterprise spreads the news, we are confident that it’s only a matter of time before those dismal family business succession statistics start to reverse.

Business Adviser is published by KPMG Enterprise™ specifically for owners and executives of private companies. KPMG Enterprise is devoted exclusively to helping business owners and entrepreneurs build thriving enterprises. For further information about how KPMG Enterprise can help private companies, visit kpmg.ca/enterprise.