South-east Asian family firms face tougher competition

Subject

Family firms in South-east Asia.

Significance

Generational change and competitive challenges are testing the resilience of the powerful family business conglomerates that control much wealth in ASEAN. Relatively few have succession plans in place, creating a risk of economic instability as ageing company founders withdraw.

Impacts

• The traditional ASEAN family business needs to evolve into a management partnership with outside professionals.
• Doing so could help it survive structural changes.
• Governments may need to plug spending gaps such as in infrastructure as businesses relinquish their market dominance.
• Inadequate governance systems, including investor protections, could hamper efforts to break up or list family assets.