Family Businesses: building a legacy of success

According to data from SEBRAE and IBGE (September 2023), 90% of businesses in Brazil are founded as family-owned. They account for 65% of the national GDP and are responsible for 75% of the jobs generated in the country. However, only 30% of these companies survive beyond the founders’ generation, and just 15% make it to the third generation. This scenario highlights a major challenge: the lack of adequate planning and structuring to ensure the longevity and continuity of family businesses.

Why Corporate Governance?

Most family businesses have an entrepreneurial profile, with a focus on the short to medium term, centralized management, and a conservative stance regarding their organizational structure. This model can limit growth and compromise long-term sustainability. Adopting sound corporate governance practices strengthens transparency, professionalizes management, and facilitates strategic decision-making, ensuring the family business remains viable for the long term. Key benefits include:

• Transparency and structure: Clearly defined roles, responsibilities, and rights help prevent conflicts and build trust.
• Professional management: Decentralized decision-making, the adoption of best practices, and operational efficiency boost internal modernization and administrative innovation.
• Sustainability and ESG: Alignment with environmental and social responsibility principles strengthens reputation and attracts investors.
• Family organization and shareholding structure: Clear rules and alignment between family and business interests provide stability.
• Succession planning: A structured succession process ensures smooth transitions, continuity, and long-term stability.

Strategic Governance in Family Businesses

Adopting a structured governance model enables family businesses to modernize management and address critical challenges. Setting clear processes, aligning family and business interests, and planning for succession are essential steps toward securing the company’s future. Corporate governance is key not only for survival but for enabling family businesses to thrive across generations, ensuring a strong, sustainable legacy.