Why and when to divest in family business

Founders can communicate their succession plan early so that they can also manage any conflicts and resistance. PHOTO | SHUTTERSTOCK

Succession planning in the context of family businesses is not merely about passing on businesses to subsequent generations. It involves more of a holistic preservation of wealth for future beneficiaries.

However, based on multiple studies, more than 60 percent of family businesses do not have a succession plan in place and over 50 percent of business owners over the age of 60 years do not have a documented plan to facilitate the transition anticipated upon their exit.

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Note: The results are not exact but very close to the actual.