University of Minnesota - UMN Executive Leadership Insights
The Family Business
Book

The Family Business

Its Governance for Sustainability

Fred Neubauer and Alden G. Lank
Routledge, 1998
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Editorial Rating

8

Qualities

  • Innovative
  • Applicable

Recommendation

Fred Neubauer and Alden G. Lank take a long hard look at the family business, both as a powerful engine of economic development and as a fragile organism in need of constant care and attention. After an initial examination of family business’ role in the global economy, Neubauer and Lank turn to an assessment of what makes some family concerns thrive while others disintegrate. Their answer: corporate governance, or the lack thereof. An academic tone permeates the book, resulting in both some patches of dry prose and an intellectual rigor lacking in most business books. getAbstract.com highly recommends this serious study of family business to any serious students of business in general.

Summary

The Nature and Power of Family Business

The family business has played a key role in driving economic development throughout history. In writing about the economic activities of the Hellenic Age, Aristotle described how private individuals and families - with the help of armies of slaves - dominated three sectors of the economy: agriculture, banking and the production, transportation and sale of manufactured goods. After capital and management were separated in the 19th century, controlling families continued to have the major say in directing enterprises at the highest level.

While family business can take many forms, the term in general refers to any business association, from a small proprietorship to a large corporation, in which voting control sits in the hands of a particular family. Even if a family does not hold a true voting majority, it still may exercise disproportionate control of a company if its name and traditions influence the company’s values and operations.

Today, family businesses are best assessed from an international perspective, since they are increasingly active on the world stage outside of their national markets. To analyze the international...

About the Authors

Fred Neubauer is a professor of Multinational Corporate Strategy and Planning at the International Institute for Management Development in Lausanne, Switzerland. He has been a consultant to multinational corporations, many of them leading, family-controlled enterprises. He is the co-author of Corporate Board - Confronting the Paradoxes. Alden G. Lank is a professor of Family Enterprises and Organizational Behavior at the Institute for Management Development. He is also President and member of the Executive Board of the Family Business Network and sits on the editorial board of the Family Business Review.

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