The Family Council : A commucation forum in the family business

by Björn, Emma; Stenström, Lovisa

Master Thesis within Business Administration Title: Authors: Tutor: The Family Council – A communication forum in the family business Emma Björn Lovisa Stenström Ethel Brundin Date: 2007-05-31 Subject terms: Family business, family council, corporate governance, communication, conflict management Introduction: Family businesses differentiate themselves from other businesses by combining business and family. This combination creates a complex situation where the family members need to unified strive towards the same objectives. A forum could be needed to unify the family members, where they can discuss different opinions and concerns. Such a forum could be a family council. The family council is a relatively new phenomenon in Sweden and relatively little research has been undertaken in this area. Purpose: Method: The purpose of this thesis is to examine the role and the implications of family councils in family businesses. This will be investigated in a Swedish context through the study of three family councils. A qualitative approach was used to fulfill the purpose of this thesis. Interviews with eleven individuals were made to gather different perspectives of the family council and its relation with the business. The majority of the interviews were made face-to-face while two of the interviews were conducted via telephone. Conclusion: The family council is created to provide the family members with a forum where they can discuss the business and owner issues, in addition it encourages the participants to communicate in a more professional manner. This forum is also a positive factor for improved cohesiveness in the family. Practical aspects of the family council are to be determined by the particular family since it is important that the structure fits the specific family. Further, the family council has a positive influence on the family but the management team is not directly influenced. The forum has improved the communication among the family members. It has strengthened the bonds, brought them closer together, and increased the respect and trust among the family members. The family council has also been beneficial when it comes to conflict management since it has helped the family members to improve their communications skills and, as a result, they are better at handling and discussing the conflict(s) to find a solution. The family council facilitates for the communication between the family members to be open where none of the participants are afraid of expressing what they feel, think or believe. ii