GCC family firms look for external capital: Study

DOHA: GCC family firms are increasingly looking externally for growth and expansion plans. A large number of  family firms are looking for external capital in the future and a considerable number of family firms have already raised external capital at some point in their history, according to a new research programme jointly conducted by  the UN-supported agency Pearl Initiative and  PwC.

The research, interviewing over 100 family firms across the GCC that covered all major industry sectors, found the region’s family firms are becoming more aware of the increasing importance of corporate governance, but it is till not yet a high strategic priority.

The report said a strong culture of privacy prevails in many family firms. Although 76 percent  of family firms interviewed produce an annual report equivalent, these are generally for internal stakeholders only. Sixty-three percent of firms disclose financial or non-financial information to banks and business partners, and only 12 percent of family firms publicly disclose any financial information whatsoever.

A key focus of the report is to recognise the importance of corporate governance in family firms and to understand the issues surrounding implementation. As ownership passes from one generation to the next, the report highlights that the key drivers to improve governance and transparency are linked to the desire to develop and pass on a healthy and efficient organisation.

http://thepeninsulaqatar.com/business/223819-gcc-family-firms-look-for-external-capital-study.html