Dubai, UAE. 5th December 2006: Increasing liberalization, privatisation and the fast pace of globalization pose new challenges to family businesses according to delegates at the 4th Arab Strategy Forum (ASF) being held in Dubai.

The challenges faced by family conglomerates were addressed during a forum panel session on 'Wealth Creation in the Middle East: A time of change for families'.

Lee Hausner, Founding Partner and National Director, Family Consulting Services, IFF Advisors, USA, said that managing family businesses need the same attention as managing a company owned by shareholders.

She said that 'legacy families' that remain successful over four to five generations have certain key characteristics, the most important being a developed sense of governance.

Hausner stressed: "Families need to look at the governance structure of their business while the senior generation is still around."

She said a clear family mission and vision needs to be shared by the family members for a business to remain successful over generations and avoid hostility and misdirection.

Kathryn McCarthy, Consultant, Family Offices and High-Net Worth Families, USA, said that families are always in transition but business and socio-economic changes need to be addressed proactively.

She said that families need to assess risks at both the family and business level. "Families with common values and interests are able to weather change," McCarthy said.

She emphasised the role of advisors and education to preserve the family legacy. 

McCarthy said: "Education can be the spark to do something else so that all the family members are not dependent on the family business."   

Mohammed Alshaya, Chief Executive Officer, Alshaya Retail, Kuwait said that it is important for Arab business conglomerates to combine best commercial practices from the West with their cultural values and traditions.

He also stressed the importance of separating business management and ownership citing the example of his family business. "Strategic decisions and investments are controlled by the family, whereas administrative and management issues are handled by external talent," Alshaya said.

Faranak Foroughi, Head of Private Banking, National Bank of Dubai, UAE, said that in order to help the families to work together it was important to educate the families about common vision, mission and values, through counselling and by encouraging communication. This needs to be done while the patriarch is still around, she added.

Todd Millay, Executive Director, Wharton Global Family Alliance, USA, said that families need to bring in outside talent and knowledge otherwise they risk becoming similar to welfare states absorbing anyone from the family into the business.

The ASF, which has attracted more than 600 distinguished participants and 115 worldwide speakers, is a vehicle for change and a key driver in the reform and policy shaping of governmental and business organisations throughout the Arab world.

Through a powerful network, facilitated working sessions, state-of-the-art technology, exclusive knowledge and informal platforms, the ASF provides participants with the resources needed to create opportunities for change in their own environments.

Among those participating in this year's event are influential personalities from the region's business, government and civil society sectors, and internationally-renowned politicians and business leaders.

Developed under the theme, 'Creating Opportunity from Change', this year's sessions are underpinned by bespoke knowledge and research on the Arab world, providing a unique information platform for the continued strategic development of the Middle East and North Africa on the global stage.

Focusing on four distinct tracks - Governance, the CEO Agenda, Arab Society and Socio-Economic - the ASF is the leading Arab platform for strategic thinking and the main launch pad for regional programmes and initiatives.

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About the Arab Strategy Forum 2006
Under the patronage of H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, the fourth ASF aims to create an environment that is as extraordinary as it is essential to the Arab world. It connects global and regional decision-makers for a strategic purpose--to engage in a hands-on, comprehensive program along four critical program tracks; CEO Agenda, Socio-Economic, Governance and Arab Society.

The three-day program of working sessions will bring together Arab and international heads of state and government with more than 600 of the most influential leaders from business, government and civil society from the Arab world and the rest of the world.

Being developed around the theme "Creating Opportunity from Change", ASF builds on its prestigious track record to propose an innovative, new format. It aims to nurture a unique type of community that will develop concrete strategies that tackle the most pressing issues faced by the Arab world today.

Through a powerful network, facilitated working sessions, state-of-the-art technology, exclusive knowledge and informal platforms, the ASF, being held on the 4th to the 6th of December 2006, will provide participants with the tools they need to create opportunities from change in their own environments, and so to make a crucial difference to the future of the Arab world.

© Press Release 2006