Exploring family business boards

Family businesses make significant contributions to gross national product, employment and wealth creation in countries around the globe. In the UK, a third of businesses are regarded as family businesses. Yet despite their economic importance, much of the current legislation on boards (eg Companies Act 2006) fails to recognize the uniqueness of family businesses and their boards. This study explores the diverse approaches to governance within small and medium-sized family businesses (SMFBs) in the UK. It draws on original evidence gathered from 8 case companies by means of longitudinal study and semi-structured interviews. It employs rich narrative, thematic case and cross case analysis to identify similarities and differences between boards using a spectrum of boards and investigates the influence of board roles and show internal dynamics affect directors and their roles during the decision-making process. Building on prior literature, which suggests that boards significantly influence the behaviour of SMFBs, this thesis identifies the importance of family, business and family business aims and stage of the business. It also identifies the importance of, education and skills and relationship using dyads while highlighting the nuances and shifting dynamics of director’s relationships. The findings are used to develop a family business board model which adds to our understanding of how SMFBs function. Finally, it suggests how the new framework might be developed to support SMFBs identify and implement governance structures, and examines the policy and praxis implications of the findings. The thesis demonstrates that family businesses set up their governance around the aims of their business and that informal roles impact on the running of the board which is currently ignored in legislation and ’best practice’ suggestions which tries to suggest ’one size fits all’