AI-ESG, a new challenge: “Veteran” family businesses must step aside to let the “Next Gen” shine.

The way to survive for family businesses in the AI-ESG era - Carbon changes the game of Thai business. It's time for the "older generation" to relinquish power and let the heir show his skills. Push the organization in Stock Exchange Find good people to join in the management - create business heirs to continue the business line.

In the midst of the world economy and the Thai economy which is not as prosperous as in the past. forcing every business to compete harder than before Combined with the arrival of AI, ESG and environmental issues, whether carbon credits or carbon footprints, as new business conditions, many businesses are affected and must urgently adapt.

Especially family business groups where most of the administrative power is still in the hands of "leader" The pioneering age group may not be able to keep up with these business trends. Of course, there is a high chance that the business will not survive to the “next generation”.

Special Professor Kitipong Urapeepattanapong ChairmanStock Exchange of Thailand revealed to bank finance that The company is currently listed on the Stock Exchange. Family businesses account for 67% or more than 575 companies.

Of this number, 76% are shares held by relatives and 24% are shares held by Holding Companies, with over 72% listed on the Stock Exchange of Thailand (SET) and another 28% listed on the mai stock exchange. If you look back at the payouts, you will find more than 53% of high dividend paying companies are family businesses.

However, the nature of family businesses around the world presents some of the same challenges. Conflict within the family From various reasons why family members feel that there is no justice. Not well paid Siblings do not communicate with each other. As a result, family businesses often end within a few generations.

In addition, modern family businesses must face new business challenges, whether it be the introduction of technology such as AI and environmental conditions such as ESG, carbon, credit, carbon footprint, etc.

This means that family businesses also need to have a good structure. Pay appropriate compensation There is close communication. There is a process for resolving conflicts. And the most important thing is to have kindness and compassion. And you still have to change your mindset in doing business. Current business leaders who are aging It is necessary to step back and allow the new generation to play a greater role in management.

The older generation must let go. Retreat to let the new generation shine.

“Business leaders of the 1st or 2nd generation who are now old must let the new generation come in because the 1st generation often sees that the new generation is not ready. Having to live under the shadow of the 1st or 2nd generation makes the new generation that needs to take over the business not want to come in and do it because the grandfather or father generation hasn't let go yet. Therefore, the older generation will have to step aside and become advisors.”

And another solution is to bring family business enter "Stock Exchange" This allows businesses to raise funds from the public without having to borrow from a bank. No interest is paid and there is no guarantee risk. To use the capital to expand or merge businesses or even make additional investments. It also improves the company's reputation. It is reliable and attracts investors to invest. At the same time, it attracts talented people, executives or professionals who want to join the company. Including reducing family conflicts because there is good supervision. Everything is clear and transparent.

“A family business must have many people involved. Including independent directors, talented employees, and talented outside executives so that children who do not have any knowledge can meet talented directors who will come in for training. Because if you work with parents, most likely you won't learn anything new because they will stick to "ordering" their children and grandchildren. Grandchildren won't dare argue. Therefore, outside executives will help compromise. We can foster and train the children of business owners.”

The important thing is to learn new things. Because the Stock Exchange There is knowledge enhancement. Provide information about the money market, capital market Including related business trends, whether it be ESG, AI, various environmental matters such as carbon, credit, carbon footprint, but if the organization is independent and does not come to use the capital market will not have access to these knowledge

“Most of the family businesses listed on the stock exchange It will be under the management of generation 2 or generation 3 because the first generation business is in the initial stage. “Not rich enough” As for the second generation, they will see that if they want to become more wealthy, they must enter the stock market. But from the current trend, more and more new generation of family businesses are being listed on the Stock Exchange. Businesses driven by the first generation usually start on the mai stock exchange, and the second generation starts to push family businesses into the SET.”

Not entering the capital market risks the business not being able to continue...if the heir says "Say No!"

Of course, in the business field, there are business owners who do not want to list their companies on the stock exchange, but must. "dawn on" that if in the future the children and grandchildren do not want to continue How will the business move forward?? Therefore, if you do not enter the stock exchange The opportunity to inherit a sustainable business will disappear. Because their children and grandchildren do not continue and cannot find investors to buy the business because the company lacks credibility. But if the company is listed on the stock exchange Even if there is no successor, the business can be sold at the reference price on the stock exchange.

“Business owners must "choose" If you don't want the hassle of doing business Likes short-term growth must take risks in the future If the business has problems, it must get a bank loan. If they don't survive, they must allow the bank to seize the company. But being in the capital market puts the company on the radar of big money owners or funds. These capitals tend to look at companies listed on the stock exchange. First of all If you have a plan to invest Therefore, if business owners consider that they are satisfied with the present and do not need to rely on the capital market, they may have to risk that their business will end in 2 or 3 generations according to the 3 generation business curse.”

When looking at the big global picture, you will find that Most family businesses are listed on the stock exchange, including LVMH, HERMES, Mercedes-Benz. Or even in Thailand itself, whether it be CP Group, ThaiBev, Central, Osotspa, they all use the capital market as a tool for business expansion. At the same time, there are family businesses that have changed hands under new management or ownership outside, such as the Oriental Hotel or the Snake Brand England, but the business is still there.

“It is important that business owners think: Do you want to create a legend or stay sustainable? Entering the Stock Exchange It helps family businesses survive even after the founder dies. If the children and grandchildren are not good at doing business, they can stay in the position of shareholder and keep the family business breathing.”

Stock Exchange Arming the family business with the capital market

Special Professor Kitipong went on to say that the Stock Exchange also places importance on family businesses. and trying to find ways to help these family businesses do business sustainably. On August 1-2, 2567, the Stock Exchange of Thailand will hold an event “The 2nd SET Annual Conference on Family Business” under the concept “Family Business in the Globalized Asia” To give wings to Thai family businesses

It is aimed at family businesses that plan to enter the stock exchange and general small businesses. To increase capacity and expand opportunities for businesses to access capital sources in the capital market. with experts and consultants from leading international institutions Along with Thai entrepreneurs from various businesses, they came to tell stories about their business growth paths. Including strategies for adapting amidst uncertain factors. Until being successful, the business can be forwarded and grow steadily.

“We want to arm Thai family businesses because in foreign countries this has been done for more than 10 years, whether in Europe, Italy, Japan, Hong Kong, Singapore, China, where there are many family businesses and 100-year-old companies, but in Thailand there is no such thing. Take this matter seriously, so we want to create an ecosystem in Thailand. To give family businesses and small businesses access to the information we have.”

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