A family business is as the phrase implies, a business that is operated by a family. Many times, people outside of the family will be hired to serve as helpful employees, but upper-level management and ownership usually stays within the family. Family-owned businesses have been successful for hundreds of years, and it’s safe to assume that many family businesses from centuries ago were quite successful, as well.
Family businesses operate according to various hierarchies, meaning it’s not always a father and mother at the top. In fact, many times, brothers, sisters, in-laws, or even cousins will take over a company, but in most of these cases, whoever the new owner is, the decision is voted upon by a board of members that are all family relatives. So, the question is, what role does the mother play when working in a family business? Is she supposed to sit back and simply supervise, or does she need to step in and take charge? Let’s take a closer look at the future of women and family business leadership.
What Does the World Currently Think about Women in Family Businesses?
There’s no denying that women play a major role within family businesses. In fact, 55 percent of these businesses already have at least one women sitting on their boards, and eight percent have boards that are comprised of at least 50 percent of women. A whopping 70 percent are considering filling their CEO position with a woman. These statistics go to show that women — now more than ever — are leaving a mark on the traditional family business hierarchy.
The Benefits of Women in Leadership
It has been found that family businesses with women in leadership roles enjoy an increased focus on corporate governance, as well as pay more attention to corporate responsibility and market acuity. Some studies have even found that public companies that have women on their boards outperform the ones that don’t have a women. The out-performance is mostly seen in relation to return on equity and net income growth.
Another major advantage of having at least one woman on the board is that a gender-balanced board is more often than not associated with enhanced corporate social performance, and this benefit alone is seen through the corporation’s entire infrastructure, including its customer service and supply chain.
3 Key Characteristics of Women in Leadership
When family-owned companies choose to include women within leadership roles, there are three primary characteristics that tend to shine throughout the company:
- Long-term thinking: Family-owned companies are willing to do what it takes to ensure their families’ are protected, meaning they are open to ideas about operational processes, even if it includes letting women jump on the board of members and/or assume leadership roles. They don’t focus on the here and now; they are always looking ahead so that they can appropriately plan for future success.
- Great display of role models: Businesses that operate according to family hierarchies and include women in upper management show all lower-level employees that the company is worth keeping afloat. It becomes apparent to all employees that regardless of gender, it is possible to move up; this helps ensure that all employees are working at their optimal performance levels.
- Unique working atmosphere: Employees these days prefer flexibility over pay. Many people would choose a 30-hour work week at $28/hour with the ability to set their own hours over a 40-hour work week at $35/hour with strict working hours. Fortunately, companies that put women in leadership roles often understand the importance of flexibility and family amenities, including child care, supplemental housing funds, and telecommuting opportunities.
More Women Equals Higher Profit Levels
As more and more family-owned businesses put women into C-suite roles, it becomes noticeable by other women that they should strive to achieve higher salaries through their family corporations. With the benefits mentioned above, there really is no reason that family companies shouldn’t consider women for their leadership roles.