By Pamela Cotant, For the Wisconsin State Journal
Establishing a board is considered to be one of the best practices to help a family business survive to the third generation or beyond. An independent board, which includes a limited number of family members, is recommended, said Ann Kinkade, director/faculty associate of the UW-Madison Family Business Center.
Yet many business owners don’t create one – often concerned about being told how to run their company and fearing a loss of control. “If you really understand how it works, you wouldn’t be worried,” said Kurt Welton, president/treasurer and chief executive officer of Welton Enterprises, a commercial real estate development and management company in Madison. “If you pick good people, you don’t have to worry about what they are going to tell you to do.”
To spread the word on the importance of family business boards, the UW-Madison Family Business Center is offering a program April 22 on the essential elements of boards and their benefits and challenges. Boards can be set up as advisory or fiduciary as businesses want them to be, said Kinkade, who also is a family business adviser. A board of advisers is elected by those who want the advice. A board of directors is elected by the shareholders and is accountable to them. Read more…