KACHARAGADLA

Carefully identifying and properly developing the next generation of leaders is by far the most consequential decision for any family business founder, owner, or leader. However, all over the world — from the Americas to Asia, from Europe to Africa — many family business leaders are quick to assume that some of their children or other relatives would never become great successors. Most consider only one person (will he or she make a great CEO?), rather than thinking of many key family members and the multiple critical potential roles they can play. What’s more, even among those leaders who want to conduct rigorous assessments of the entire next generation’s capabilities, most don’t know what they should focus on, and many wait until the eleventh hour to ask the crucial questions. Consider the CEO of a family-owned business in Buenos Aires who called me in as a consultant. The executive, who was in his seventies, began our first meeting by leaning forward and saying to me, in

The great secret of business families that achieve tremendous wealth and hold onto it for generations is that they persistently promote the entrepreneurial spirit that led to their initial success. That drive — a combination of ambition, sheer will, and the willingness to take calculated risks — is integral to long-term success, particularly in challenging times. One third-generation family CEO we know recently delivered a powerful message to his teenaged next generation when he said, “In times like this, a lot of companies will go bankrupt. But, because we’ve always run our family business on the tenets of entrepreneurial drive and diversification, our family business will survive this crisis and be in a position to prosper in the long term. Learn from this experience and think about what you can do as an entrepreneur.” This is valuable advice, not just for the younger generation as they grow and develop as individuals, but also for the future of the family businesses in gen

On August 19 the Business Roundtable issued an open letter titled “Statement on the Purpose of a Corporation.” One of the preeminent business lobbies in the United States, the Business Roundtable (BR) includes the CEOs of leading U.S. companies from Apple to Walmart. Sandwiched between the spare title and 181 signatures was a one-page declaration that ended as follows: “Each of our stakeholders is essential. We commit to deliver value to all of them, for the future success of our companies, our communities, and our country.” On its own, this sentence is indistinguishable from the anodyne commentary that fills the annual reports of many Business Roundtable members. For those actively following this topic, however, it represents a very public rebuke of the Milton Friedman worldview that guides business decisions behind closed doors. Friedman, the renowned University of Chicago economics professor, penned a famous 1970 New York Times essay, “The Social Responsibility Of Business Is to In