Shareholders Have to Earn Their Wings, Too

The distinction between ownership and management, so critical for the effective running of modern enterprises, is poorly understood by many family companies. If ever there was an issue that validates the old maxim “Something you don’t know can hurt you,” this one is it.

The rights of owners have become increasingly defined in the courts (see “Giving Minority Shareholders Their Due,” Winter 1994), but the perpetuation and health of the company depends not just on respect for legal rights. It turns to a great extent upon a proper understanding by family members of the roles and responsibilities of owners and managers.

Already a subscriber? Sign In

About the Author(s)

Related Articles

KEEP IT IN THE FAMILY

The Family Business newsletter. Weekly insight for family business leaders and owners to improve their family dynamics and their businesses.