Ownership Competence in Business Families

Successful multigenerational family businesses ensure that family members who make, support or influence decisions in the business or the family are capable of successfully performing their roles. This requires a deep knowledge not only of the business but also of the role of a shareholder, and the values, culture, needs and objectives of the business family. “Ownership competence” enables family members – regardless of their ownership status – to contribute to the success of the business and the cohesion of the family in whatever role(s) they may hold. The term “ownership competence” suggests that ownership skills are only relevant for current and future shareholders. Professional shareholders not only understand but also exemplify family values and goals. They know that these must be aligned with internal structures, strategies, and guidelines to ensure the long-term durability of the business and the family. This under standing enables them to make decisions that are value-oriented and economically sustainable for the entire system. What, though, does ownership competence look like  in practice? What do business families understand by ownership competence and how do they systematically develop ownership competence for their shareholder group? Tom Rüsen, Ruth Orenstrat and Claudia Binz Astrachan investigate these questions using survey data collected in 2021 from 218 German business families.