SINGAPORE (Jan 15): Singapore’s largest listed companies are mostly government-linked entities, but there are also a good many that would be classified as family businesses. These include the likes of City Developments, controlled by the Kwek family; Thai Beverage, controlled by Charoen Sirivadhanabhakdi; Genting Singapore, controlled by the Lim family; and United Overseas Bank (UOB), led by the Wee family. In fact, the local stock market is largely comprised of family-owned — and often family-run — businesses. While these family businesses often have the benefit of a highly motivated shareholder, they carry their own unique set of risks.

To evaluate the risks and likely success of a family firm, investors may want to consider its level of complexity, says Koay Peng Yen, a consultant with global leadership advisory firm Spencer Stuart. “Family businesses can be complex in terms of their business and family. Different complexities show different kinds of risks for investors,” he says. “Investors who want to assess family firms and their ability to thrive need to categorise these family firms according to complexity.”

Koay and National University of Singapore associate professor Marleen Dieleman are undertaking a study of Asia’s top family firms. The duo picked out the top billionaires in 10 Asian countries based on Forbes’ rich list, and traced the billionaires to companies that they own. Those deemed not to be family businesses were filtered out, leaving a sample of 200 companies. In Singapore, these companies include the Ng family’s Far East Organization, the Lees’ Oversea-Chinese Banking Corp, the Kweks’ Hong Leong Group and Wilmar International.

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