A business partner must be chosen with extreme care. No amount of due diligence is enough when entrusting someone with half your fortunes.
Family, on the other hand, cannot be chosen. It is forced upon us whether we like it or not.
A financial decision requires cold calculation, an almost Vulcan absence of emotion. Such a state of mind is virtually impossible to attain in the company of a sibling, a spouse or an offspring. Particularly the latter.
It seems odd, then, that the idea of a family business has always been so popular.
In the Middle East and India, family and business are almost synonymous. The wealthiest and most successful business people in both regions -- the Tatas, Mittals, bin Talals, Al Futtaims and the like -- are all from long lines of equally successful and wealthy forebears.
In Russia and China, meanwhile, family business is almost unheard of, chiefly because until very recently there was no wealth to pass from one generation to the next.
In the U.S., individuals tend to make fortunes and spend them or give them away. Look at Warren Buffett and Bill Gates, two of the world's richest men, who are in the process of doing precisely that.
Europe still has a fine tradition of family businesses, particularly France but Britain has hardly any at all.
Société Générale, the French investment bank, recently studied the fortunes of more than 1,200 billionaires from all over the world to determine how big an influence family ties had on their commercial endeavors.
The broad results of the global study are fascinating, not least because they reveal how the world is divided into differing business cycles dependent on the political and historical development of a region or country.
The report also reveals that families, despite the large number of successful business dynasties in the world, don't seem to be the best at running commercial affairs.
The Middle East is a fine case in point.
As The National reported last week, fortunes among the wealthiest families in the Middle East have fallen by an estimated 33 per cent since the beginning of the financial downturn in 2008. The survey studied the fortunes of 21 billionaires from the UAE, Kuwait and Saudi Arabia with closely held family business empires.
Businesses run by wealthy individuals in the same countries without the inclusion of an extended family in the boardroom only suffered a 3.6 per cent decline in fortunes. A huge difference.
But this fact should come as no surprise.
Family adds another layer of complication and opacity to affairs that business can well do without. Examples abound all over the world.
Rupert Murdoch has plenty of problems running his British newspaper publishing division. The fact that his son and heir James was at the helm of the division only added to his woes. There is nothing to say that James Murdoch is an inherently bad manager or necessarily swayed by his father's opinions but that is how his leadership was perceived. Inevitably he had to fall on his sword.
Closer to home the Abdullah brothers, the founders of Damas, one of the region's biggest jewellery groups, provide another example. Born into a family of jewelers, they ran their business privately and very successfully for years. But when it became a public company their traditional way of doing business on a handshake and paying themselves using funds and assets without seeking permission from investors did not go down well and led to regulatory censure and dismissal for all three of them.
Although worlds apart on many levels, Damas and News Corp have something fundamental in common. They are both good businesses that have outgrown the dynastic model. As public companies there is no room for the inherited loyalties and understandings only a family can provide. Instead, transparency, good governance and independence are needed.
Family businesses are like children. There comes a point when they must fly the nest if they are to continue to flourish and become successful enough to keep their parents in their old age.
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