Personal Perspectives

The key question currently on many South African’s minds is, “What next?”. 

The last few years have shown us that uncertainty is firmly a certainty in life, along with death and taxes. Another certainty for KPMG Private Enterprise is that the contribution of business families to the South African and global economy1 will continue to be a driving force. The long-term view of business families drives the resilience of the family and their business during uncertainty, and importantly they have the ability to respond and rebound from a crisis stronger and more resourceful than before. This contribution is not only from a financial capital perspective, but also highlighting the importance of human and social capital.

In this edition we consider how legacy is a key factor in the long-term financial performance of family businesses, as well as their sustainability practices. There is a key complimentary consideration, being the need for transgenerational entrepreneurship, and to be forward looking when it comes to the business’s strategy, as well as the family’s shared purpose. The article, “Unlocking Legacy for South African Business Families” shares some guidance for business family leaders to find a balance between tradition and innovation, and in turn to create a legacy that ensures the success of their business(es) across generations. This question lies at the heart of the recent STEP Project Global Consortium and KPMG Private Enterprise's comprehensive study on family business legacies (the study).

What is clear is that there is an evolution in the definition of legacy, to a more future-centric definition, where legacy is about preserving tradition while embracing change and ensuring continuity while charting new paths forward and sustaining the business family’s relevance and impact for generations to come and society at large. The article also reveals the Legacy Matrix, enabling business families to assess where they currently find themselves in the matrix, and shares guidance as to how to move toward, and/or maintain, a more dynamic legacy.

For the business to be future-fit, it needs to consider its business transformation journey, considering the key risks and opportunities