American businesses, especially family businesses, are a patchwork of sizes, types, business models, and cultures. Working out of living rooms as well as boardrooms, corner cafes and highrises, from smartphones, offices, laptops and garages, there is no “model” family business owner in the United States. Australia, however, wants to change the game for Australian businesses and family businesses in particular, and the Business Council of Australia has set out to do just that.
Australia takes its family businesses very seriously. Studying what and how family enterprises are defined, collecting statistics on them and delving into the inner workings of the family business was the object of an Australian governmental project report in March of 2013, followed closely by a survey of Australian family businesses. The Parliamentary Joint Committee on Corporations and Financial Services conducted extensive investigation and hearings on all aspects of the family enterprise, including whether or not to adopt previous definitions of the family business, such as the European Union definition, Finland’s legal definition, the American definition, and previous Australian definitions. All aspects of family business entities were explored in the hearings, as the purpose was to “inquire” and “report” to the House of Parliament requesting information.
Finding the lack of any reliable data on Australian family businesses, including a commonly-accepted definition, the Committee issued its findings that this was a necessary step, in order to compile accurate statistics. [page 51] Certain key characteristics of the Australian family business were identified in the report, summarized by contributors as:
“We have a stronger engagement with our staff than typical companies.
Our employees value that the owners are visibly known people that they can talk to. The success of many family businesses is something employees take great pride in.
We measure our organisation culture to ensure family values and expectations are embraced by our people…
Our decision making is not confined to reporting periods and bonus horizons but reflect a vision over decades. This contrasts starkly with much of the listed corporate sector.”
“I believe [Australian family businesses] are the fabric, heart and soul, of our local communities.”
The list is short, but comprehensive, as to what Australian family businesses are, that distinguishes them from other, nonfamily business enterprises:
- A long-term mindset (looking at generations into the future, not the next annual report)
- An aversion to risk.( expenses under control, less debt, less investment)
- Flexible decision-making (Owners not encumbered by board protocol can convene quickly and make important decisions on short notice)
- Retaining staff (keeping nonfamily staff is a badge of pride for family businesses)
- Community-based and community-oriented (Family businesses are engaged in, and contribute to, the communities in which they operate, from charitable donations to involvement in communities beyond their business interests. Australian family businesses that live and work in their community can keep connected to their customers by using new route-optimization software and other technologies that monitor customer preferences and keep logistics smoothly running. )
More about the family business in Australia was addressed in a survey, conducted shortly after this report was officially presented — to be continued in another article.