Family Business: More women at the helm of family businesses

This article first appeared in Wealth, The Edge Malaysia Weekly, on September 27, 2021 - October 03, 2021.
Caroline Russell is executive chairman of BOH Plantations, Malaysia’s largest tea producer. The business was founded by her grandfather in 1929.

Caroline Russell is executive chairman of BOH Plantations, Malaysia’s largest tea producer. The business was founded by her grandfather in 1929.

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Women have increasingly been holding bigger roles in society. We see many powerful women leaders making a significant impact globally. In Europe, there is German Chancellor Angela Merkel and in the US, there is Vice-President Kamala Harris. Over in the Eastern part of the world, there are Taiwan President Tsai Ing-wen and New Zealand Prime Minister Jacinda Ardern, both known for their effective responses to the Covid-19 pandemic, successfully defending their countries during the first few waves. In Malaysia, we have Dr Wan Azizah Wan Ismail, who was the first female deputy prime minister.

Aside from the political arena, there are many women leaders in the sphere of family business. Forbes’ Asia’s Power Businesswomen 2020 list includes leaders of family businesses. Among them are Roshni Nadar Malhotra, CEO of HCL Corp, the holding company for all of the group’s entities. She succeeded her father and became chairperson of HCL Technologies in July 2020. 

Another leader on the list, Olivia ­Limpe-Aw, is CEO of Destileria Limtuaco, the oldest distillery in the Philippines. The fifth-generation family business has been in existence since 1852. In Malaysia, Caroline Russell succeeded her father and became executive chairman of BOH Plantations, the country’s largest tea producer, in 2020. The third-generation family business was founded by her grandfather in 1929.

Evolving role of women in society

The increasing number of powerful and influential women leaders globally is encouraging, but we must also understand it from the standpoint of human evolution — we have come a long way to reach this stage but we still have far to go in terms of gender equality. The STEP 2019 Global Family Business Survey shows that only 18% of family businesses around the world are led by women and this relatively small percentage seems to imply that women still face a glass ceiling. 

From a biological viewpoint, women as child bearers have to go through the process of pregnancy and labour, not to mention sleepless nights looking after their newborns. From the societal point of view, they are generally seen as the home carer, looking after the elderly and the youth. This tradition can be attributed to the fact that men are generally physically stronger than women, and thus would take up the responsibility of earning a living for the family. Not forgetting also that during times of war, it was mostly men who joined the army while women stayed back to look after their households. In terms of personality, women are also known to be softer, and are thus seen as the ideal candidates to look after the family, be it in conflict resolution or patience with screaming kids. 

The role of women in society is largely influenced by culture too. Indeed, many of the eligible women successors in Asian families face constraints when it comes to succession. For example, in some cultures, women are considered only when no male successor is available, when all the male successors decline taking over, or when there is a crisis to be solved. 

The preference of sons over daughters has to do with the family wishing to keep the legacy and wealth “within the family”, or in other words, ensuring the survival of the family surname. In countries where children strictly follow their father’s surname, when a woman succeeds, her children would bear her husband’s surname — this is deemed as losing the family legacy and wealth to “outsiders”. In the extreme case of a very traditional Japanese family, when there is no male successor, the woman successor must find a suitable husband who will then adopt the family surname and join the family business. This approach helps to ensure that the offspring carry the family surname. 

An eligible woman successor from Pakistan who wished to remain anonymous told me in an interview, “My father is very traditional. It will be my brother who succeeds him — he will not consider my sister or me as potential successors. Even if my parents did not have a son, my father would get one of our male cousins to succeed him instead of my sister or myself, because he wants to ensure that the wealth stays in the family.”

Of course, there are many forward-thinking business families. Take for example, Miss Ng, the second-generation leader of a family business in the food and beverage industry in Malaysia, whose father founded the business with the support of his wife and sister. After giving birth to their second child, Ng’s mother became a full-time mum and took on an informal role in the business. Ng explains that her mother was not involved in day-to-day operations and would only step in when needed. 

For Ng, even though the second generation comprises just her and her younger sister, her father welcomes their succeeding him. Married with two young children, she works full time in the family business after having gained experience in multinational companies. “As far as I can remember, I have always spent my school holidays and weekends, and sometimes even after school, following my father around the restaurant. Although he always says I can do whatever I want, he also tells me to ‘come learn this, come learn that’. I know, deep down, he wishes that my sister and I will take over the business one day as he always says that whatever he worked for is for his children,” she says.

Preparing the female successor

To prepare a female successor, we must first understand the generational effect — there is a difference between the founding generation and succeeding generations. If the family business was founded by a couple, and either one chooses to take a step back, there is still one person to run the business. However, the succeeding generation may not have such an option. 

Ng explains, “After my mum gave birth to my younger sister, she had the option of staying home to look after us and took on an informal role as my dad was working full time in the business. However, in my generation, there is just me as my sister is still in college, and she might choose to pursue her own passion instead of joining the family business. I don’t have the option to step back and be a housewife, although my father actually encourages me to focus on my young children first as a mother is irreplaceable.”

Therefore, it is essential for family businesses to start legacy planning as early as possible. After all, such businesses are here to stay through generations. Sons and daughters often have different experiences leading up to the legacy planning process. Through traditional family upbringing and stereotyping in society, daughters can be heavily influenced by traditional gender roles, which are formed at a young age. Such influences may shape the mentality of female family members to be more concerned with the family’s needs, rather than tending to the family business. 

As such, a change of mindset should be the focus when it comes to legacy planning. When daughters are the sole successor of the family legacy, the traditional thought process of females being the home carer of the family should be dismissed entirely. “Growing up, when I followed my father to work, he did not expect anything different of me because I was his daughter. Even if it was at the construction site, renovating the restaurant, fixing things, getting my hands dirty, he did not expect anything less from me. There is no such thing as being ‘princess-like’. I’ve always joked that I am his part-time son,” she quips.

Women’s capabilities and strengths

Over the last few decades, women have indeed improved their standing when compared with men. From the days when women were considered the inferior gender, they have mostly achieved a level of acceptable equality. 

Women have shown, in many instances, to be better in navigating emotions as well as having a more risk-averse attitude towards decision-making. These are vital qualities in sustaining a family business in many aspects. Childbearing and biological aspects naturally make women more conscious of caring for the family. Equipped with these skills, women leaders can look after the needs of both the family and business. 

The emergence of women leaders can bring about a softer and calmer atmosphere, especially during times of crisis and turbulence, when focus is needed in finding solutions. The diversity of views and approaches can have the incredible potential for bringing about a more interesting and prosperous future for the family business. 

In a world of ever-changing business trends and opportunities, traditional gender stereotyping is no longer relevant. The idea of a female in the driver’s seat, once seen as impossible, is no longer a question mark. It is the way forward. 

Dr Feranita is a lecturer at Taylor’s Business School’s Faculty of Business and Law

This article is a collaboration between Family Business Network (FBN) Asia and Taylor’s University. FBN Asia, a regional chapter of FBN International, which represents family businesses in 65 countries across five continents, offers opportunities for stakeholders of the family business to learn, thrive and transform across generations to build a sustainable future.