Family Business Governance

CHAPTER 1

Introduction to Family Business

Before discussing family and corporate governance, the reader should have some basic background knowledge in family business, and public and private business ownership. The following section is designed as a quick primer or refresher on need-to-know information that allows readers to be knowledgeable when presented with family business terms, mechanisms, and issues that can be prevented by and/or solved with more effective governance.

Throughout the world, family business is the most prevalent form of business. It is as much as 70 percent of all firms in the United States (Astrachan and Shanker 2003) and an even higher amount in Europe. Of the many companies today, chances are they started with family ...