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1. OVERVIEW, NATURE,
AND IMPORTANCE
OF FAMILY BUSINESS
By: Nimrod B. Cabrera

2. Learning Objective
At the end of the lesson the students
must be able to explain the steps and
importance of starting a family business .

3. Family Business
Is a commercial organization in which
decision-making is influenced by multiple
generations of a family related by blood or
marriage who are closely identified with the
firm through leadership and ownership.

4. Owner-Manager
Entrepreneurial
Firms
Not considered to be family business
because they lack the multigenerational
dimension and family influence that create
the unique dynamics and relationships of
family businesses.

5. Corporate vs Family business
Corporate
The roles of the manager of a
business are separate and
distinct and are equally
significant to the success of
any enterprise.
Family
In the family business, the
roles are usually performed by
the same people, leading to
some unique problems that do
not affect public companies.

6. General Partnerships,
Limited Liability
Partnership
Different Types of Family Business
These two have differences when
it comes to shareholders’ liability,
taxation, separate legal entity, and
public disclosure.
Public and Private
Limited Companies
A public limited company is able
to offer its shares to the public.
These are also subject to stricter
legal requirements than private
companies.

7. Importance of Family Businesses
Family businesses have more
longterm strategic outlook due to their
main motivation consisting of creating
a legacy for generation to come.
Family businesses are less
likely to raise debt and are
widely deemed financially
prudent.
Family businesses show
higher profitability in the
long run.
Family businesses are less
likely to lay people off and
more likely to hire despite
the possibility of an
economic downturn.
Family businesses are more
likely to give charitably to their
respective communities and
engage in extensive
philanthropic activities.

8. Seven Reasons Why Family Businesses Benefit the Society
1. Acting Responsibility: Family businesses are the largest
employers.
2. Prepared for the long term: Family companies plan for resilience
in crises.
3. Regional roots: Family businesses and their location.
4. Well, positioned: Young specialists value family businesses.
5. Big contribution: Family businesses fill the state coffers.
6. Building trust: Risk and control in the same pair of hands.
7. Generous donations: Family businesses take on social
responsibility.

9. Thank you
for attending!