Why Business Owners Tend to Choose Their Children as successors

Why Business Owners Tend to Choose Their Children as successors

     Source: 戴志強：《家庭企業”子承父業”繼任模式分析》(學習與實踐2009年第五期)

     In this essay, the author lists some reasons that make business owners to pass down their firms to their next-generation. The most important factor must be the concept of family that deeply rooted in people’s mind. There is a long history of agriculture in China, and after more than two thousand years’ feudal rule, now that the concept could be a significant core of Chinese people’s behavior.

     

     The first reason the author gave was that it matches human’s instinct of pursuing the continuity of life. And creating own business and passing down them to children could be a way to attain it. Confucius once said,” your physical person with its hair and skin are received from your parents…….” (身體髮膚，受之父母) Children’s life are thought of as the continuity of the parents’. Therefore, those self-established entrepreneur who sweat blood all their life are not willing to just give their accomplishments away to other people than their later generations as their continuity of life and to keep their own family flourishing.

     

     For the second reason, the author thought that the social trust is generally low in our society. It’s hard for the entrepreneurs to rely on outsiders because the connection between the firm and the outside successors is based weakly on law, the system and the contract, etc, and sometimes the morality. And on the other hand, now the influence of the traditional concept of Chung, Hsiao, Jen, Yi (忠孝仁義) and karma in religion become weaker gradually. All that mentioned above do dampen down the social trust in some way.

     

     Then the author also provides some explanations for why children take over the firms. The successors may witness the process of the firms’ being stronger year by year since they were young. Therefore it becomes easy for them to take the company with emotion as what they should work and fight for. They run the business as if that’s their obligation. For another reason, the pressure from clan is crucial too. Once they do not take the responsibilities that everyone thought they should, then through the family network, they will soon be “notorious” for being lazy, not having a good work ethic and so on in the clan.

    

     But in my view, what if one does not do a good job in what one successes? One statistic says that 64.8% entrepreneurs still choose their children as successors even if they are devoid of competence or not willing to take over the firms. (中國私營企業發展報告)I think that will lose the meaning of passing down the flame. When they fail to manage the business well, it would be impossible to be as a continuity of life to their parents. Since if one has the particular spirit that is worth to last, it is not necessary to be limited inside family members. What If the spirit could be used by anyone who appreciates it and apply it more smartly?