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Wasim Ahmed Trade & Merchant Finance Brokerage Specialism Business Finance Expert Profile Wasim Ahmed is the MD of Trade & Merchant Finance Brokerage, with 20 years’ experience in Banking & Finance. Wasim is an expert in SME Finance and has extensive experience of financing business of all types & sectors. www.tmfbrokerage.co.uk

considerations that should be taken when setting up a business Whether it is a corporate firm or public limited company, whenever a business is set up, there are some important aspects that need to be given due process & extensive consideration. Key Considerations: • • • • •

What does the role of chairman entail? Who will take the role? Will the role be for life? What are the advantages & disadvantages of the role? What is the role of a CEO, and who will take it on? What role do directors play – what are their powers, limitations, and who will they be? What is the role of the shareholders? Who will they be? What will their rights, powers, and limitations be? Succession planning – who will be the successor?

However, the reality is that these considerations are equally important in a private limited firm and especially in family owned businesses. In fact, I must stress that it is even more important for family owned & oriented business, as families have to maintain good family ties outside the business parameters. Sadly, too often these important aspects are not given due consideration at the outset and hence, they create significant problems. In many instances this has resulted in either demise of a successful business enterprise or worse, which is to say families have been torn apart. In many of these instances the damage is often unfortunately irreversible.

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GENERATION AUTUMN / WINTER 2018

As the business grows beyond its humble origins, the spirit and ethos for which it was created has got lost somewhere along the line

This in itself can sometimes create potential disputes among those who are simply shareholders, and the executives (directors who also hold shares). The complete list of disputes is endless and beyond the scope of this article. However, to give a taster, the disputes could range from distribution of dividends, level of dividends, who is hired/fired, the direction a business is going, and who will potentially take the reins of the business from the next generation (family politics/ nepotism vs competence). Though these issues in an ordinary corporate environment might seem simple and logical, but given the family business scenario the same issues can become complex and convoluted. Because all of the individuals usually involved in the process are close relatives, these matters spill out of a boardroom environment into

When building a house, the strength of the foundations determine the size of the building structure that can be built upon them

Wasim Ahmed details the key

A recent study by PWC Global have found that 71% of family firms haven’t adopted any procedures for resolving family conflicts between family members*. As a corporate Finance Brokerage we get involved with helping finance management buyouts for SMEs. Commonly, the shareholders of a family business are predominantly made up of family members. However, all of the shareholders might not be involved in the day-to-day running of the business, i.e., as executives, directors or managers.

How to Protect Your Family Business

family homes and sadly in many instances with courts etc. As the business grows beyond its humble origins, the spirit and

Profile for Family Business Place

Generation Magazine 2018 A/W Issue  

Generation Magazine 2018 A/W Issue  

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