18% growth rate ‘can’ maintain wealth level

The family companies in the Gulf region need to grow at least by 18% each year to maintain the same level of wealth across generations, Pearl Initiative was told yesterday.Family business, therefore, need to re-evaluate their existing portfolios to gain a sharper focus and even sever emotional ties to traditional businesses which may be underperforming and look to a more diversified approach within a sector or industry to leverage on brand, market and core competencies, David Dhanoo, group chief legal officer and board secretary, Qatar Financial Centre Authority said, quoting a recent study by Booz and Company.Many family businesses are still in the hands of the first generation and will face hurdles posed by the transfer of control to the second and third generation.In terms of control of the family business many GCC families rely upon “mother” or “holding” companies to preserve family control and whilst this simulates the trust vehicle used in Western countries, it does not offer the same control tools, he added.