Dubai Chamber of Commerce and Industry in cooperation with Family Business Council Gulf (FBCG) recently hosted a webinar, which offered valuable insight on the changing dynamics of family businesses in Dubai, common conflicts that can arise and practical steps that can be taken to address them.
The virtual event, attended by nearly 50 participants representing family businesses in Dubai, was organised as part of a strategic partnership between Dubai Chamber and FBCG. Sessions led by PwC tackled a wide variety of issues and topics including risks and causes of family conflicts and case studies, as well as practical ways to prevent, minimise and manage conflicts.
An informative presentation from PwC shared recommendations for family businesses to take early on to avoid such issues, which including agreeing on a common vision, establishing a family council, creating family rules, decoupling family issues from business issues, developing a concept of fairness in the family and agreeing on a conflict resolution mechanism. Other critical steps in conflict resolution include establishing the facts to address the concerns raised by all parties and conducting a thorough review and valuation of existing assets.
A poll during the session indicated the most common issues that often cause conflicts in family businesses, including breakdown of trust and miscommunication among family members, differences in management decisions and roles, and dividend distribution, among others.
The webinar also included peer group discussions in smaller groups supported by international facilitators from FBCG’s global network. Participants agreed that effective means to prevent and manage conflict entails clearly defining the family roles and responsibilities in the business, engaging external advisors on the family board and professional mediators in the event of a conflict.
In his opening remarks, H.E. Hamad Buamim, President & CEO of Dubai Chamber of Commerce and Industry, noted that although the pandemic has posed many challenges for family businesses, it has also given them a new opportunity to re-evaluate their priorities and find new ways to become more productive and manage their overheads more efficiently.
H.E. Buamim described the Chamber’s partnership with the Family Business Council Gulf as an important development that has helped the organisation expand its support and guidance to family businesses in Dubai during challenging times.
New research conducted by Dubai Chamber and the Family Business Council has pointed to a consensus among families on the need to diversify their businesses, invest in startups, and develop a succession plan and governance structure, he added.
Last year, Dubai Chamber and FBCG signed a Memorandum of Understanding with the objectives of providing transparency and insight on key trends and issues impacting family business in the emirate and helping companies make informed business decisions and plan ahead for post-Covid recovery.