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Passing It Down The Family


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A Father’s Wish For His Son


wealthymatters“I hope your first deal is a loser, otherwise you will think you’re a lot smarter than you are.” – the very words with which Fred Koch inducted his son Charles Koch into the family business,

Gurunath Meiyappan


weathymattersEver since IPL match fixing made it to the news,many googlers have reached my blog by searching for Gurunath Meiyappan and/or Rupa Gurunath. So here is some background information about them for the curious:

42-year-old Gurunath Meiyappan comes from the AVM family, which manages AVM Studios-one of the oldest surviving studios in the country. His father, AVM Balasubramanian, is an honorary consul for Paraguay and an ex-president of the Southern India Chamber of Commerce and Industry.His mother, Lalitha, is an avid golfer and has represented India in the sport in international events.  Gurunath Meiyappan’s grandfather was AV Meiyappan, the founder of AVM Productions. Gurunath has a bachelors degree in commerce from Chennai’s Loyola College.He is the managing director AVM Productions and Entertainment.He is also the team principal of the IPL team Chennai Super Kings and son-in-law of BCCI president N Srinivasan,V.C. of India Cements. Gurunath is an introvert who is known to talk to only those with whom he is comfortable with.  Read more of this post

Protecting The Family Businesses And Wealth


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For business families succession planning is important to ensure the continuity and growth of  business and  protection of  the economic interests of all family members.Family business owners are concerned about the interests of their spouses post their demise, disputes among siblings over the wealth and the leakage of the family’s wealth as a result of litigious divorces or family fights.Then there are concerns about ring fencing assets from litigation and confiscation.Sheltering from taxes is another common concern.

Both the objectives of ensuring the continuity and growth of  business and  protecting  the economic interests of all family members could be conflicting at times.Protection of the economic interests of all the family members often results in the distribution of wealth because it may  involve each  family member directly holding shares of the company.This may prove detrimental to the interests of the business for various reasons.One of them is that all the family members may not be inclined to run the business.Another reason is that one of the family members owning a significant stake may dispose off his/her holding to an external party,thus leading to loss of control over the company.Since all the family members are not inclined to run the business on a day-to-day basis,it would be essential to split the management and operating roles from the ownership,which entails a fresh challenge.The business owner might want to give exactly equal number of shares to everyone,but those who work in the business may feel they are entitled to more.Likewise,those who don;t work in the business may feel the same way about their own shares.After all,they may reason, they’re not drawing salaries,so they should get a bigger share of dividends and profit-sharing. Read more of this post

The Dangers Of Ossification


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In the story below Alok Kejriwal narrates what happens to a family business when it is ruled with an iron fist by the older generation which gives younger family members and outside professionals no opportunity to air new ideas.

Experience is good.And everything new is not necessarily good.Professional managers are not automatically better than family talent.It doesn’t pay to cast aside the old tried and tested methods without thought.However,nothing good comes out of eschewing new ways altogether.Taking a risk on something new,when the older way has been very successful,is hard.But regularly experimenting with new ways in a controlled manner and adopting them if they are good, is a must to stay competitive. Read more of this post

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