PROFESSIONALISING FAMILY BUSINESS GOVERNANCE IN FAMILY

When a well-established glove manufacturing business in Kerala crossed into its second generation, everything seemed to be going well on the surface.

- MR Rajeshkumar

The company was profitable, their products were respected in the market, and the family was known in their community as a close-knit business family. But beneath that polished exterior, tensions were building. The brothers had never clearly defined their roles, the next generation was growing restless, and family discussions about business decisions often spilled over into dinner-table arguments. What had once been a shared passion was slowly turning into a source of friction.

Things reached a tipping point when one of the brothers’ sons was brought into the company without clarity on his responsibilities. His cousins, who were already working in the business, felt sidelined. At home, conversations between spouses grew tense with some urging for their children to be “given a fair chance”, and others questioning why certain family members seemed to have more say than others. Quietly, frustrations that had been contained for years began to find their way into family gatherings and even celebratory occasions.

Soon, the ripple effects reached the business. Decisions slowed, trust eroded, and the unity - what had once been the family's strength- was now becoming its greatest challenge. Key managers began to leave, weary of navigating family politics. The business that once prided itself on its unity was now divided because the family hadn't evolved as quickly as the business had.

In many ways, this family’s story isn’t unique. Across India, countless family businesses find themselves in a similar position where the business has outgrown the way the family functions. Success in the market- place often masks the growing strain within the family. When relation- ships and roles aren't redefined to match the business's evolution, even the strongest bonds begin to crack.