A frequent and particularly sensitive issue in the context of family businesses concerns the succession process and the selection of a new leader. Scenarios in which founders—after decades of effort—are called upon to pass the reins to their descendants are especially common. When more than one successor is involved—such as two siblings with different skills and personalities but a shared ambition to continue and evolve the business—the leadership dilemma becomes complex and emotionally charged.
In this context, the concept of corporate governance becomes critically important. Co-leadership (dual leadership) is often proposed as an alternative solution to ensure the balanced participation of multiple family members in the management of the business. Despite its potential benefits—such as combining complementary skills, simultaneously overseeing different departments or geographical areas, and strengthening transparency through mutual accountability—its implementation requires strict conditions.
The key success factors for such a model include:
- clear allocation of responsibilities,
- well-defined boundaries of authority,
- the adoption of a consistent decision-making framework,
- institutionalized accountability mechanisms,
- and, most importantly, trust and institutional cooperation between co-leaders.
History has shown that the absence of strategic governance can undermine the long-term viability of even the most robust family businesses—particularly when leadership is passed from the first (founding) generation to the second. A well-known example is the Vanderbilt family in the United States. Despite amassing substantial wealth and operating numerous businesses, within just two to three generations, most of that wealth had disappeared. The lack of institutional discipline, rational investment, and a unified vision can lead to the complete erosion of family assets within a few generations.
Succession is not merely a technical or organizational matter. In family businesses, such decisions are complicated by human relationships, emotions, and the need to preserve family unity. Therefore, the choice of a co-leadership model should be based on objective criteria and supported by a structured governance system designed to promote both operational effectiveness and intra-family balance.
Effective governance is the cornerstone of long-term sustainability for family businesses. The co-leadership model can be a functional solution, provided it is implemented with institutional rigor and strategic foresight. On the other hand, adopting such a model hastily or based on emotional considerations can lead to conflicts, delays, and ultimately destabilization, both at the organizational and family levels.
In many cases, the involvement of experienced external, independent advisors is essential—especially when family members are unable to approach the issue rationally due to emotional entanglements or potential conflicts of interest.
Additionally, it is important to agree early on to basic rules regarding the family business, establish a family council, and clearly separate the roles of ownership and management.
A conscious and institutionally organized leadership transition ensures the long-term prosperity of the business, while preserving family unity and enhancing the prospects for sustaining and expanding both wealth and vision for future generations.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
