12/09/2013
At the last Session of the Forum of family business transformation:
Turning products from ' family to contribution' is the application of governance
Most family businesses going without a system to resolve disputes
In the final session of the Forum (turning the family business into contribution) which was headed by Managing Director Saudi Fransi Capital Yasser Alromayan, Dr. Iyad Redha of Office Dr. Ryadh Taha legal consultants and attorneys working paper on (turning family firms into shareholding companies and legal protection) said that the main problems of family businesses (melting of quotas, and family disputes) noting inter features to convert to stock companies either closed or public.
Alromayan reviewed some features of transformation to a joint stock company and that company does not end with the death of the founder, as the arrow in the company 2 million riyals (closed contribution) and 10 million (General contribution). In the second paper of the meeting itself, titled (the importance and advantages of application governance in family firms), Director of corporate governance for the CMA Alwaleed Sinani that governance is the system through which defines the rights and responsibilities of the various parties as the Board of Directors and executive management, shareholders and other stakeholders in the company.
He pointed out that, according to studies made by some consulting firms to more than 80 businesses in the Middle East is for family companies. But a number of researchers expect the contribution of family firms in the non-oil GDP in Saudi Arabia more than 90.
Turning to the risk facing rich family business, including risks and that upon receipt of the third generation of the family to run the company and the majority of family businesses do not have procedures for resolving disputes among family members, expected to face family businesses during the current and the next two decades, transition on receipt of the third generation, because of differing views and future plans because of the transition from one generation to another. He said there was several positives result from application of the rules of good governance in family business, which benefits the local economy leading to enter new markets and increase competitiveness, GDP growth, add several benefits to the companies themselves, such as promoting the continuity of the company, the ability to divest ownership partners, secure liquidity, access to banking facilities at a lower cost, finding the largest base of customers and suppliers of the company.
Sinani said that one of the most important elements of corporate governance is practicing shareholders of their rights related to the share, and enable shareholders of the minutes of the meeting of the Assembly, provide the authority with a copy of the minutes of the meeting during days of date, and inform the market of the outcome of theGeneral Assembly upon its completion.
