Written on 28 June 2012.
EDHEC Dean Olivier Oger
Why the interest in family businesses?
Firstly, it’s a return to our roots for EDHEC, bearing in mind that EDHEC was founded in 1906 by family-owned businesses in the textile industry. Next, the project was suggested to us just under a year ago by members of the EDHEC alumni who now run family businesses. Lastly, data shows that family businesses are in the majority. They account for well over 50% of the world economy and more than 80% of all companies based in OECD countries. In France, over 80% of the 4,400 companies classified as intermediate in size are family-owned.
What are their characteristics?
They focus more on long-term viability than on short-term profitability. They are also attached to their local roots. They can be international in outlook, while remaining solidly anchored to their region. A large number of observers believe they are better equipped to resist during times of crisis than are companies which are subject to financial markets. The evidence shows that regions where family-businesses dominate have been less impacted by the crisis.
What are the EDHEC Family Business Centre’s objectives?
We want to serve this sector of the economy by heightening our students’ awareness of family businesses. We also want to act as a go-between by promoting regions and businesses that generate economic growth and jobs. The EDHEC Family Business Centre aims to reconcile the local with the global in the same way that many family businesses are doing at the moment. By doing so, we want to help family businesses to grow and to raise their profile with our students.
What do you mean by “reconciling the local with the global”?
The general thinking is that globalisation runs counter to the interest of regional industries. However, experience shows that family businesses known for their commitment to a local area are capable of internationalising without harming economic activity in their region of origin.
What initiatives does the Centre plan?
The Centre plans to develop executive education activities (seminars, small-scale breakfast events, conferences), as well as undertaking and publishing research on problems specific to family businesses, such as financing family businesses, managing inter-generational succession or managing their growth. We intend to heighten our students’ awareness of the career opportunities offered by family businesses, their values and their specific management issues. Business Schools too often tend to use large listed groups as examples. We will be making sure that family businesses are among the cases studied in each course.
Why a branch in Asia?
The family-business phenomenon is just as prominent in Asia. The Chinese, Indian and Japanese companies entering into markets in Europe currently are family-owned. The project has aroused a great deal of interest in Singapore where EDHEC is present. This Asian branch will provide a vantage point for observing practices over there, while also helping us to make relevant comparisons with France and Europe.
Do other initiatives of this type already exist?
The Hénokiens (an international association of family businesses that are at least 200 years old), the Family Business Network, ASMEP and the Institut Français des Administrateurs all operate in this area. We have been in close contact with all these bodies for the launch of the EDHEC Family Business Centre.
And among business schools?
Although leading international business schools like IESE in Barcelona, IMD in Lausanne and Harvard run family-business initiatives, only a very few French schools take a real interest in the subject.
Interview by Sandrine Tournigand