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Research examines role of NextGen in UAE family business
A new study exploring the interests and attitudes of the UAE’s youth toward joining and leading their family’s business has recently been released by American University of Sharjah (AUS). The study was conducted in partnership with the Global University Entrepreneurial Spirit Students’ Survey (GUESSS) and the Family Business Council Gulf (FBCG).
Led by Dr. Rodrigo Basco, Associate Professor of Management and Sheikh Saoud bin Khalid bin Khalid Al-Qassimi Chair in Family Business at AUS, the report focuses on UAE undergraduates between the ages of 18 and 23, comparing them to their counterparts in the region and the world.
Omar Kutayba Yusuf Alghanim, Chairman of FBCG, remarked that the survey findings point to a younger generation that is aware of the myriad opportunities afforded to them in the UAE and feels empowered to make its own career decisions.
“Family businesses are evolving in the GCC and it is clear from this important survey that today’s graduates will look to leave their own stamp when they move into leadership positions. While fewer graduates are looking to join family businesses in day-to-day management roles, I am optimistic that many will remain involved as owners and board members overseeing a professional executive team. And by participating in board-level activities, some family members may decide to return to executive roles in their mid-careers. These cross-generation discussions are incredibly important to the future of family businesses across the world,” he explained.
He added, “At the FBCG, we have an ongoing dialogue with younger generation family members when we meet at the majlis reception program. Our secretariat also manages their participation in the FBN ‘Next Generation’ program, which is open to members aged 18-40 and is a global network for exchange."
The findings of the study, titled Succession Intention: The United Arab Emirates NextGens, showed that next generation undergraduates were keen to explore other options and interests besides joining their family businesses.
Dr. Basco explained: “Even though we observe a low intention by the next generation of family firm members to join their family businesses, we have to understand that undergraduate youth are facing a critical stage in their lives as they experience independence, build their personalities, differentiate themselves from their family members and look for a new meaning in their personal and professional life as young adults.”
Family businesses are the most common form of organization in the UAE and are considered important contributors to the UAE economy. The study explores the drivers of the next generation’s succession intention by considering individual personal characteristics, parent-child relationships, and societal norms and culture. It also notes that while families have their own unique circumstances, there are a few common themes and solutions that they often share. The study places great emphasis on the role of the current generation and the positive impact it can have on the next generation’s succession intention.
“It is important to understand NextGen succession intentions because they are vital for the family firm succession process. Business families have a role in shaping and influencing the succession intentions of NextGens, creating more opportunities and inspiring them to have more exposure to the family business, nurturing their confidence to execute tasks related to the family business and assume future leadership and providing them with information on alternative routes into the family business such as board leadership, shadowing and intrapreneurship,” said Dr. Basco.
The study also recommends that business families must constantly look for ways to improve communication with the next generation and be open to their preferred medium and style of communication. Families can also find ways to keep next generation undergraduates interested and engaged in family business affairs by keeping them involved in business activities, and seek their opinion on challenges facing the company and its future prospects.
For more information about the Sheikh Saoud Bin Khalid Bin Khalid Al Qassimi Chair in Family Business at American University of Sharjah and its initiatives, visit www.aus.edu/sba/the-sheikh-saoud-bin-khalid-bin-khalid-al-qassimi-chair-.... For more information about the report and to download a copy of the report, visit https://www.aus.edu/research/impact/faculty-research/business-and-manage...