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How do family businesses keep their founders’ entrepreneurial spirt alive and continue to grow from decade to decade and generation to generation? What’s the secret to their staying power and their ability to stay ahead of competitors? The STEP Project Global Consortium and KPMG Private Enterprise set out to find the answers. We wanted to understand how family businesses continue to be such regenerative powerhouses that not only flourish in good times, but also manage to respond positively to change during times of disruption.

Our exploration began with an in-depth survey of 2,439 family business leaders across the world, including 56 respondents from Malaysia. After a detailed academic analysis of the survey data, we moderated a series of roundtable discussions in February 2022 with family business CEOs along with family business academics and professional advisers. The discussions focused on the factors and challenges that are influencing the continuous renewal and performance of family businesses. We heard how their regenerative power begins simply enough — with the founders’ entrepreneurial ambition to turn an inspiring vision into a practical reality.

Regenerative powerhouses: Malaysia’s benchmark

Learn about the secrets behind the regenerative superpower of family businesses in Malaysia

Key findings out of Malaysia

A continuous search for new opportunities

Proactiveness was the most common characteristic for family business leaders in Malaysia at 62 percent.

Instead of reacting to events that are often outside their control, Malaysian leaders are constantly searching for new opportunities at home and abroad, watching for clues that may indicate a change in market demands; and setting the competitive agenda that forces other companies to react.

Beyond financial wealth

Socioemotional wealth is seen as endowment to be protected and preserved for many generations to come.

41 percent of respondents from Malaysia reported a high level of family identification with their businesses, while 54 percent stated that the level of family control and influence within their firms was high. The impact of socioemotional wealth is reflected on the greater emphasis these leaders put on non-financial and internal social performance, recognizing these factors as fuel igniting their business regenerative power. 

Leading with authority

Authoritarian leadership style was the most prominent at 59 percent among the survey respondents.

Authoritarian leaders exert powerful authority over their subordinates. Though it was the least preferred option globally, it did appear the most among CEOs from Malaysia. The primary impact of an authoritarian/patriarchal style of leadership is seen in the strength of family bonds and their emotional attachment to the business, which further motivates them to perform at a high level. Transformational and charismatic leadership style were reported at 48 percent and 34 percent respectively.

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