At the Family Business Summit 2024, Sam Abu, the Country and Regional Senior Partner for West Africa at PricewaterhouseCoopers (PwC) Nigeria, shared an impactful insight into the importance of family businesses in the global economy. According to Abu, these enterprises are responsible for about 70 percent of global wealth creation. His analysis, encompassing various industries and regions, highlighted the crucial contribution of family-owned businesses to Economic Growth and Innovation worldwide. The summit, themed ‘Family Business Legacy: Strategies for building and maintaining multigenerational wealth’, focuses on the structures and strategies that enable relative businesses to thrive and remain sustainable across generations.
The influence of these enterprises is particularly pronounced in the region. Abu explained that more than 70 percent of the country’s small and medium-sized enterprises (SMEs) are relative-owned, contributing close to 50 percent to the country’s Gross Domestic Product (GDP). However, a relative enterprise refers to a business organisation where multiple generations of a household play a significant role in shaping its decisions. These relative members are united by familial ties through blood, marriage, or adoption.
Multiple obstacles are slowing the progress of local businesses’ growth.
Furthermore, these relative members can impact the business’s vision and strategic direction and are dedicated to leveraging this power to reach unique and enduring objectives. Abu emphasised that while household enterprises contribute to wealth generation and economic development, they face many challenges. In his speech, Abu emphasised the changing international environment currently affecting companies. Swift technological developments, particularly Artificial Intelligence (AI) and digital innovations, introduce fresh challenges and demand operational changes. Concurrently, embedding Environmental, Social, and Governance (ESG) criteria is crucial for firms aiming for sustainability.
Moreover, globalisation creates chances in emerging markets while intensifying competition and risk. Abu pointed out the unique challenges confronted by companies in Africa. Although the continent holds significant growth opportunities, unstable currencies like the naira, rising inflation, and unpredictable exchange rates frequently obstruct its economic progress. These hurdles create a challenging environment for businesses, particularly relative-run operations that must manage economic turmoil while pursuing sustainable achievements. Despite challenges, Africa ranks among the world’s most rapidly developing regions, offering a wealth of prospects for growth and investment.
Companies were urged to adopt strategies for lasting growth and relevance.
Also, the interplay of factors in household-run businesses adds complexity to their growth patterns in the nation. Abu noted that these organisations often face challenges in reconciling family traditions with the need for professional management and governance. Additionally, there is a persistent effort to merge long-standing familial customs with modern technological advancements, especially as these ventures evolve through different generations. Business owners must navigate the challenge of passing on leadership to their successors, preserving the company’s economic health heritage and character.
Abu remained hopeful about the prospects of local and international enterprises, even in light of current difficulties. He highlighted the necessity of formulating strategies and welcoming innovative approaches to promote strong, enduring businesses across generations. As per Abu, the solution to tackling challenges rests in implementing modern tools, such as technological progress, to facilitate organisational change and growth. In this way, relative-owned enterprises can maintain their significance and edge in an ever-globalising market. The summit conversation encouraged Nigerian household-run businesses to pursue measures that ensure their longevity and prosperity.
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Lastly, these enterprises can navigate their limitations and thrive in an ever-evolving environment by adopting technological advancements, prioritising innovative strategies, and implementing a solid administration framework. With thoughtful organisation and intentional choices, family-owned enterprises can build financial resources for their benefit while making important contributions to the economy, highlighted by the crucial part they play in stimulating growth on a national scale. Sam Abu’s perspectives during the summit provide a valuable guide for family-owned enterprises in Africa and the nation. They enable them to tackle contemporary business challenges while preserving their heritage for posterity.