Practice vs theory : evaluating the impact of the Family Business Act on family business succession

Abstract

Family businesses are a vital part of the global economy, which is why their succession should be given significant importance. Enacted in 2017, the Family Business Act is a unique piece of legislation, which gave family businesses a distinct identity along with a number of fiscal and governance benefits. The objective of this study is to assess the impact that the Act has had over the last two years. The study looks into the factors that influence the successful transition of a family business from one generation to the next as well as analyse how legislation can affect this process. From the emergent findings it is apparent that the Family Business Act has not gone unnoticed by professionals and business owners alike. Specific importance has been given to the educational aspect and how this goes hand in hand with the incentives. At the same time, a number of common family business governance issues have been identified. Only time will tell how fruitful the Family Business Act has been within the local scenario, however, all signs seem to be pointing in the direction of success as long as education remains at the forefront of the Family Business Office’s agenda.