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The adage "governing is anticipating" applies fully to the corporate world, and even more so to family businesses, where emotional and professional dynamics intertwine. Waiting for a crisis to erupt before taking action is a common mistake: only implementing professional corporate governance can limit risks and ensure long-term sustainability.

Family businesses are particularly vulnerable to tensions. Family conflicts can spill over into the company, and conversely, professional issues can sour private relationships. If left unchecked, these emotional interactions can paralyze decision-making. Iconic examples have shown how internal disputes can go so far as to jeopardize a company's very existence (1).

Family businesses represent around 45% of employment and form an essential part of the economic fabric

The stakes are high. In Belgium, more than 70% of companies are family-owned. They represent around 45% of employment and form a vital component of the economic fabric. Yet, their vulnerability to internal conflicts remains a sensitive issue.

Sources of tension

Among the main sources of tension are:

  • Role confusion, involving an overconcentration of power or a lack of clarity regarding responsibilities.

  • Importing family patterns into the professional sphere, where old frustrations—sometimes dating back to childhood—can resurface.

  • Disengagement of non-active shareholders, who feel uninformed, under-heard, or excluded from key decisions.

  • Generational divides, when the cohesion found among the founders does not carry over to the next generation.

  • Succession disagreements between those advocating for family continuity and those considering a sale to third parties.

  • Mismatches between skills and roles, which can generate feelings of nepotism or inefficiency.

Solutions

Faced with these challenges, several levers can strengthen corporate governance:

  • Define a clear strategy: developing a strategic plan aligns visions. A family council can oversee monitoring and alignment, while operational management is entrusted to the executive leadership team.

  • Involve all stakeholders: it is essential to involve shareholders as well as employees, clients, or suppliers in key strategic discussions.

  • Clarify everyone's role: organizational charts, job descriptions, and performance reviews prevent a lack of objectivity. The Three-Circle Model (family, business, ownership) also helps foster a clearer understanding of the underlying dynamics.

  • Address delicate topics without taboos: an honest diagnosis conducted with an external expert identifies strengths and weaknesses, allowing potential tensions to be managed professionally.

  • Surround yourselves with external expertise: independent directors who align with family values bring a neutral perspective and help prevent emotional drift.

  • Foster smooth communication: this goes beyond simply sharing information to taking family sensitivities into account. Such communication creates a sense of belonging, particularly for non-active shareholders.

  • Adopt a mediation mindset (2): listening, empathy, and seeking shared solutions often defuse existing tensions and prevent future ones.

The tools of good corporate governance are well established: family charters, shareholders' agreements, strategic plans, executive committees... Beyond these instruments, their effectiveness depends on tailoring them to the specific reality of each family business. This approach requires broad involvement and relies on a climate of trust. Establishing governance in a family business also means recognizing the complexity of human relationships. Setting up a structured framework allows the future to be built with peace of mind.

(1) As was recently the case with bus manufacturer Van Hool, for example, although the causes of its bankruptcy were multi-factorial.

(2) This Mediation Attitude is one of the core foundations of Fondaris, offering mediation and governance solutions tailored to family businesses.

Article originally published in La Libre Économique by Tanguy della Faille, Partner at Fondaris, on 10/05/2025. Published/updated version on the Fondaris website with the author's permission.