Common Disputes In Family-Run Businesses And How To Resolve Them

There is a well-used phrase of “never work with animals or children,’” but what about family? Working with family can bring many benefits, including enhancing a company’s reputation and bringing stability to the business. However, disputes can make life difficult if they are not handled appropriately.

Family businesses will have all the usual business issues to handle, with the added complication of personal relationships too. This overlap between business and personal relationships can make finding resolutions for both the company and private lives complex, as decisions can invariably have dramatic effects on both.

Taking the emotions out of emotive situations

Emotions often run high when it comes to a business where several members of a family have a stake, and addressing these must be prioritised before making fundamental business decisions. Legal processes and courtrooms often inflame many areas of disputes that could be resolved quickly and less painfully if the parties sought mediation of the type we at Company Mediation can provide to manage disputes in the first instance.

Common disputes that mediation could help with

Common family-run business issues where mediation is highly effective include:

The death of a parent – If a parent passes away, leaving the business to siblings, the parties might disagree on how to take the company forward. Using the services of a mediator from Company Mediation where each party can speak privately and freely to a trained and experienced individual, will help remove the emotional barriers and set the path to better decisions and mutual agreements.

Inappropriate behaviour – Sometimes, parties in the business may feel other family members are behaving inappropriately and are concerned about the business impact. Mediation services will help reduce tension and enable partners to have constructive conversations through individual and group discussions. An experienced mediator can assist you in finding solutions that protect relationships and deal directly with the problems to get the business back on track.

Business disagreements transgressing into personal disagreements – When disagreements in business become personal and other family members, partners or non-family members are affected, mediation can help separate home and business roles, allowing those on both sides of a dispute to step back and see the bigger picture.

Succession planning – Sometimes, leadership decisions need to be made between generations. Perhaps younger family members are pushing to take over, or older members wish to step back and meet resistance from younger members who feel they’re not ready to take the reigns. Company Mediation can help parties recognise the way things need to go or see solutions that haven’t been considered. They are an independent eye to help identify the best resolution for all.

Contract or regulatory disputes – These can also be overcome with mediation before either party gets to the point of seeking further legal recourse. Often, assistance from Company Mediation will remove the need to take other action or at least shows the family that everything has been attempted before going further.

Businesses with strategies and measures in place to avoid disputes in the first place can avoid much of the widespread negative impact that such disagreements cause. Mediation can help set boundaries and teach how to handle problems before they become too large or require stressful and costly legal intervention.

Outside dispute resolution services are there to listen to each party, find common goals and help build the most suitable resolution for all parties without the emotion that is often the cause of disputes escalating far more than is necessary. Benefits often far outweigh any resolutions achieved through the courts and can ensure that your business and familial relationships are managed separately, making for a much smoother, happier business and private life.