Family businesses in GCC driving economic growth, diversification

Zawya

a day ago

An interview with Sheikha Hind Suhail Bahwan, Chairperson Of The Family Business Council Gulf
Muscat – The Family Business Council Gulf (FBCG) is a not-for-profit organisation aiming to strengthen family business governance and ensure their continuity over generations. The Council seeks to identify and address issues unique to the GCC region through research, education, capacity development and networking among peers. In an exclusive interview with Muscat Daily, Sheikha Hind Suhail Bahwan, Chairperson of the Family Business Council Gulf, discusses the critical role family businesses play in the economic landscape of the GCC countries. She offers insights into the Council's efforts to strengthen governance, support generational transitions, and foster sustainability in family enterprises. Sheikha Hind also outlines the key challenges and priorities shaping the future of family businesses across the region.
What are the main focus areas and top priorities of the Family Business Council Gulf (FBCG)?
The Family Business Council Gulf was established in 2013 with a mission to promote the sustainability and success of family enterprises across generations. Our focus is on enhancing the contribution of family businesses to the economic and social development of the region, while also reinforcing their significance as essential pillars of economic resilience, innovation, and regional identity.
How do you assess the FBCG's impact since its formation? What initiatives are currently underway to support family enterprises across the GCC?
The Family Business Council Gulf has made a significant impact across various areas. Firstly, we have successfully created a strong identity and community for GCC families, fostering meaningful friendships and, in many cases, productive business partnerships. We prioritise next-generation training, having trained over 300 future leaders who are poised to inherit or take ownership of family businesses.
Additionally, FBCG has made considerable progress in raising awareness about the importance of good governance and succession planning within the family business ecosystem. In the UAE, we played a pivotal role in collaborating with authorities to develop a comprehensive legal framework that regulates the ownership and governance of family businesses in the country. FBCG hopes to be able to play a role in replicating this framework in other jurisdictions across the region.
What are the most common issues that member families bring to the Council for support?
Each family business is unique. In the absence of regulatory frameworks, FBCG would typically be approached for guidance during situations where there are: challenging family business leadership successions, the unexpected passing of a founder or major shareholder, financial disputes amongst family members, disputes over fair allocation of inheritance, agreeing fair allocation of dividends, divestment or liquidation of assets, agreement on how business decisions are to be taken, who has the casting vote, disagreements over the strategic direction of the family business and tension between a professional management board and the family members. As you can see the issues are wide and can be complex and these issues are further amplified during periods of economic downturn.
In your view, how do family enterprises in the GCC contribute to national visions such as Saudi Arabia's Vision 2030 or Oman Vision 2040?
Family businesses have been instrumental in the development of the GCC region, with estimates suggesting that their contribution to private sector GDP ranges from 60% to 80%, depending on the specific country. These enterprises are also key employers within the private sector and are major contributors and investors in private capital for strategic initiatives that promote economic diversification, particularly in sectors such as real estate, retail, hospitality, manufacturing, mobility, technology, fintech, and energy.
What are the main challenges facing family businesses in the GCC today? And what are the biggest gaps you have identified in current practices that the FBCG is working to address?
The challenges faced by family businesses are diverse, but from the perspective of the Family Business Council Gulf, we can categorise them into three main areas. Firstly, the professionalisation of family businesses is crucial. This includes separating ownership from management, establishing a professional board of directors, creating a clear business strategy, implementing disciplined business planning, and developing robust governance structures, with a strong emphasis on detailed succession planning.
Secondly, a common challenge is the ability of the second or third generation to take on leadership roles. This may stem from a gap in business knowledge or a desire to pursue different career paths. Lastly, a third challenge – one that is not unique to family businesses – is the lack of constructive dialogue and communication. This can create unnecessary tensions that negatively impact relationship dynamics and adversely affect the effectiveness of the business.
According to the Council's research, only 33% of Gulf family businesses have a documented succession plan. Why are this figure so low, and what initiatives is the FBCG undertaking to encourage and improve succession planning in the region?
There are multiple reasons most of which I have mentioned previously. Whilst we have made good progress, there is still a long way to go and that is why the FBCG places a tremendous emphasis on training the family business 'next gens' through structured programmes and peer exposure. Additionally, we need to build on the work undertaken in the UAE and work with relevant GCC authorities to implement regulatory frameworks to address the governance, ownership and inheritance of family business.
In your view, how can next-generation leaders be better prepared to take over? What advice would you offer to families struggling with leadership transitions?
Leadership transitions in family businesses are critical moments – and preparation is everything. It starts with open communication: within the family, with trusted advisors, and with others who've navigated similar paths.
Expose the next generation early. Even if they don't join management, they should understand the business, embrace family values, and grow into responsible owners who can carry the founder's vision forward.
Building a talent pipeline is just as important. At FBCG, we offer programmes like Pathfinder and Launch360 to help young family members discover their strengths and prepare for future roles from an early age. To families facing transition: start early, invest in development, and keep the conversation going. The future depends on it.
How do you view the role of women in family businesses? Are women sufficiently represented in leadership roles within family enterprises across the GCC?
When we launched the Family Business Council Gulf, female representation in our membership was below 5%. Today, that number has risen to over 25%, and we are proud to have two female board members. Here in GCC, we are fortunate to have established and successful female role models, such as Muna Almoayyed from Bahrain, Lubna Al Olayan from Saudi Arabia, H E Raja Al Gurg from UAE, and many more.
How does the FBCG support families during major transitions such as IPOs, mergers, or divestments?
FBCG can facilitate knowledge sharing and connect family businesses with others, both regionally and globally, that have experienced similar journeys. We can also introduce family businesses to a trusted network of advisors who can assist with transactions. Furthermore, if needed, we can provide customised support and expertise tailored to the specific nature of each family need and aspiration.
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