According to Brookings, family-led businesses are companies where members of the same family, or related family branches, hold a majority interest and exert a dominant influence on the firm’s strategic direction through ownership, governance, management and vision.
Family-led businesses in Africa are deeply rooted in tradition, often tracing their origins back several generations. Through decades of hard work and determination, these enterprises have weathered economic challenges and societal changes, emerging stronger and more resilient than ever. They are not just businesses; they are institutions, woven into the very fabric of their communities.
At the core of family-led businesses in Africa is a deep-seated commitment to community development. These enterprises recognise that their success is intricately linked to the well-being of the communities they serve. As such, they actively invest in initiatives to uplift underserved populations and foster economic empowerment.
Remgro Limited, a South African powerhouse founded by the Rupert family, wields significant influence across the nation’s economy.
The Bidco Africa Group, founded by the Shah family in Kenya, has emerged as a leading player in the continent’s consumer goods industry, catalysing economic transformation and driving socio-economic development across East Africa.
In Nigeria, one of such institution is the Honeywell Group, founded in 1972 by Oba Otudeko. Otudeko, founded Honeywell Group as a trading enterprise, focusing on importation and marketing of commodities across Nigeria and the West African sub-region. Over the years, this conglomerate has diversified its interests across various sectors, including manufacturing, real estate, and hospitality, employing over 5,000 people across its various subsidiaries.
The company’s initial focus on commodities trading laid the foundation for future growth. This experience honed the group’s ability to identify market opportunities and navigate complex business environments. Recognising the potential for further growth, Honeywell Group strategically diversified its portfolio.
One notable milestone in Honeywell Group’s journey was the listing of Honeywell Flour Mills on the Nigerian Stock Exchange in 2009, following a successful initial public offering (IPO) in 2008. Additionally, the conglomerate ventured into the hospitality industry with the launch of the first Radisson Blu hotel in Nigeria in 2011, further solidifying its presence in the market. Radisson Blu is on track to reach 15 hotels in Nigeria by 2025. From one hotel in 2015, they maintain a portfolio of 12 hotels and 1700 rooms in operations in Nigeria.
As a case study in the evolution of family-led businesses, these companies offer valuable insights into effective corporate governance and long-term sustainability.
Through strategic planning and prudent decision-making, experts said, these conglomerates have navigated generational transitions while staying true to their founding principles, adding that, their success is a testament to the importance of vision, adaptability, and a strong sense of purpose while commitment to long-term stability and responsible leadership positions them for sustainable growth and attracts long-term investment.
As Africa asserts its position on the global stage, experts said, family businesses lhave a crucial role to play. With a keen eye on emerging trends and opportunities, a Nigerian firm, Honeywell Group, for instance, continues to innovate and adapt, ready to seize the possibilities that the future holds.
The firm, among other enterprises, are well-positioned to drive sustainable growth and foster innovation, with their deep-rooted connections to local communities and a long-term perspective.
By embracing the values of integrity, community engagement, and intergenerational stewardship, these businesses, experts stressed, are not just building wealth for themselves but also laying the foundation for a brighter and more prosperous Africa for generations to come.
Family Business Sustenance Tips
Stating that, its difficult to create a long-standing family business enterprise, the dean of the Lagos Business School, Professor Chris Ogbechie has said that only 30 per cent of family businesses survive beyond their first generation.
Ogbechie stated this during his welcome address at the Lagos Business School Family Business Conference which was held in Lagos.
According to him, “family businesses all over the world are faced with unique challenges. This has inspired the LBS to come up with an initiative to foster conversations surrounding the peculiar challenges faced by family-owned enterprises.
He said, “despite their contributions, statistics show that only about 30 per cent of Nigerian family businesses survive past the first generation. This highlights the critical need for tailored support to ensure their longevity and continued success.”
He highlighted the need for continuous learning and adaptation to ensure sustained success in an ever-changing business landscape.
The director of the Family Business Initiative, Dr. Okey Nwuke said many family businesses have gone out of business owing to a vast array range of issues, saying about 24 million family businesses in Nigeria contribute up to $200 billion to the national economy.
In her keynote address, the founder of the Chair Centre Group, Ibukun Awosika highlighted the need for a family business to clearly articulate its vision.
She noted that the survival of family businesses across generations primarily depends on structures built to enable the business outlive the founding fathers.
She also advised that family businesses should allow successors to run with their ideas without necessarily being bugged by pre-existing templates of their predecessors.
Speaking further, Awosika stated that for family businesses to stand the test of time, they must embrace the right values. She also cautioned that families must critically examine their individual talents to determine how these talents would be deployed to various aspects of the businesses.
