To family-run businesses, professionalization is a sensitive theme, to say the least. Defenders of good governance in family businesses usually say, with all possible tact, that professionalization is recommended. But they always politely note that a family member can, indeed, be the best person for the job. Time passes, but discomfort with the idea remains the same, as became evident at the 19th annual meeting of the Family Business Network (FBN) — an association of family-run businesses from around the world —, held from October 20 through 22 in New Delhi (India).

The event’s highlight was the presentation by Sunil Mittal, president of Barthi Enterprises and one of the world’s most respected entrepreneurs. The magnate stated his belief in full professionalization. “The participants were perplexed to find out that he sees no sense in family members participating in a company’s operation”, says Herbert Steinberg, president of Mesa Corporate Governance, who attended the event.

More recent theories defend the minimization, or even exclusion, of family members from company operations, suggesting that their participation should be focused on the board of directors. But many among the audience still seemed unwilling to accept these ideas. To feed the controversy, the Lombard Odier Darier Hentsch 2008 — a family-business-of-the-year award — went to Roca, a Spanish company without any family members leading operations. Concerning succession, Jose Miguel Roca, CEO at the company, declared: “We should help out our children and nephews by giving them a quality education, so they can go out and live their lives. And that’s it”.

Questioned by an indignant American woman who asked “how will heirs feel about that position?”, Mittal answered: “That’s their problem”. (Silvio Muto)