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Do Family Businesses Need Independent Directors?

What value do they offer? Are they a threat to control? Does the family need to retain a majority in case of a vote?

Why would a family business not want the benefit of an independent director who might bring insight, perspective, varied experiences, and a wide range of contacts that could help propel the business? In the past year, I have delivered seminars in Asia, Africa, Europe, the Middle East, and North America on building high-performance boards in family businesses. In every location, these are some of the excuses I heard from attendees:

  • We don’t want any outsiders
  • We don’t want to lose control
  • We don’t want anybody telling us what to do
  • We don’t wash our dirty linen in public
  • We don’t want to be accountable to anybody else
  • It’s not broken why fix it
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