Corporate governance: structuring ownership, control, and family interests

In family businesses, ownership, management, and supervision are typically intertwined. This makes governance less formal than in large corporations, but at the same time more complex. Whereas corporate governance or good governance in listed companies revolves around control and accountability, in family businesses it is about finding a balance between generations, interests, involvement, ownership, and responsibility.

As the company grows and more family members become directly or indirectly involved, the need for a clear structure increases. Not only to manage business risks, but also to keep relationships clear and to ensure the continuity of the family business.

Balancing management, ownership, and involvement

In family businesses, roles are often intertwined: the director is a shareholder, the supervisory director is a cousin, and the founder continues to have a say in decisions. As long as the lines of communication are short, this works.  But with growth, generational transfer, or tensions, informal decision-making proves to be vulnerable.

Typical governance issues are:

• How do you divide voting rights and ownership without fragmentation?
• What if family members do not play an active role but are shareholders?
• How do you prevent family conflicts from damaging business continuity?
• How do you deal with the tension between reinvesting for growth, financial buffers, and the income needs of family members?

Clear agreements about roles, powers, and procedures bring peace of mind and predictability, both internally and towards external parties such as financiers, employees, or regulators.

Legal and fiscal foundation of corporate governance

A good governance framework starts with the legal structure. Instruments such as an advisory board, supervisory board, or a trust office (STAK) can help separate ownership and control. Articles of association, shareholder agreements, and management regulations form a solid basis for agreements that will last for generations.
The tax aspect is also indispensable. Structuring dividend policy, remuneration of family members, or voting ratios in succession are examples where taxation and governance come together. The professionals at HVK Stevens ensure that the agreements are not only correct on paper, but also stand up to scrutiny and disputes.

Corporate governance as a strategic tool

Governance is not an end in itself, but a tool to protect the family business and assets while keeping it agile, resilient, and true to family values. Good governance makes it possible to:

• ensure a smooth transition to the next generation
• attract external directors without losing identity
• maintain mutual trust, especially in times of change

Tools such as certification, deeds or gift agreements, a family charter, family council or a formal shareholders' agreement contribute to clear expectations and shared principles. In this way, governance does not become a bureaucratic layer, but a reinforcement of the family business and assets in practice.

A solid foundation for ownership, control, and trust

With the right governance, the family business and assets remain manageable, resilient, and connected to family values, now and in the future. Curious about how corporate governance can strengthen your family business? HVK Stevens provides clarity on what works for your family in terms of ownership, control, and structure.