Hard to let go: A Perspective on family Business Succession planning
Cultural norms significantly shape how succession is approached and executed in family businesses. These norms influence who is considered a rightful successor, the values prioritized during the transition, and the level of formality involved in planning. Societies differ in their reliance on traditional methods of passing on leadership versus embracing modern professional practices. While some cultures favor inheritance-based transitions, others, particularly in the West, increasingly adopt meritocratic or governance-based approaches. So why is it so “Hard to let go” from the point of view of family business succession planning?
Adrian Florea, Executive Director at Concelex and a graduate of the Master of Arts in Board Practice and Directorship program delivered by Henley Business School in partnership with Envisia Boards of Elite, elaborates in this interview on the complex aspects of succession in Romanian family businesses. In his view, the succession planning process is influenced by a series of personal and business factors. “Often, founders postpone these decisions until they are forced by unforeseen events, such as health crises or external pressures. This delay reflects an internal struggle related to identity, control, and legacy,” Adrian states.
The level of governance sophistication plays a crucial role in succession processes. Western economies, focusing on transparency and formalized governance structures, tend to have clearer and more structured succession practices. By contrast, in many Asian markets, succession remains a personal and informal affair, heavily influenced by trust and loyalty. For example, South Korea’s family businesses, or chaebols (large, family-controlled conglomerates), often pass leadership within the family, reflecting Confucian values of hierarchy and seniority. Meanwhile, countries like Germany and Sweden in Europe lead the way in governance practices, integrating advisory boards and external professionals into succession planning.
Romania, however, presents a unique case. As a young market economy, succession planning in Romanian family businesses is shaped by a mix of traditional family ties and evolving business expectations. Romanian culture rather underlines trust and loyalty within the family, which leads founders to prioritize children or close relatives as successors, even if they are not necessarily willing to take over, lack the necessary experience, or exhibit a deficit of needed entrepreneurial skills. This preference is seen both on a micro scale, such as in small family businesses, and in larger family conglomerates, where the focus remains firmly on keeping leadership within the family.
This approach, however, is further complicated by the absence of well-established governance structures, making succession a deeply personal and informal process.
In this cultural setting, next-generation family members may struggle to establish themselves as business successors, particularly if their aspirations or modern ideas conflict with established practices. If these perspectives are ignored, the transition risks alienating key individuals, potentially undermining the business. To bridge this gap, founders must take on an unifying role, balancing respect for traditional values with openness to professionalization and innovation. By fostering collaboration within the family, they can ensure that the generational transfer of ownership and leadership strengthens rather than divides the business.
Adrian Florea’s research offers valuable insight into these dynamics. Published as part of Chronicles from the Boardroom – A Romanian Perspective by Envisia Boards of Elite, his work forms part of the first graduating cohort of the Master of Arts in Board Practice and Directorship program delivered by Henley Business School in partnership with Envisia.
With over 25 years of experience in executive and management roles across top multinationals, private enterprises, and family businesses, Adrian brings a wealth of expertise to his research. His career spans industries including energy, construction, telecommunications, IT, and aviation. Beyond this, his contributions as an executive member, independent director, and chairperson across nearly 20 boards add further depth to his understanding of corporate governance.
Adrian’s study examines how Romanian family business founders respond to the challenge of their succession, a process essential for ensuring business survival and continuity. By combining his academic insights with extensive board practice experience, Adrian highlights the complex interplay of cultural values, personal motivations, and governance practices in succession planning.
Family businesses are integral to the global economy and constitute a fundamental pillar of the private sector. Many of the Romanian businesses face however significant challenges in transferring leadership at first generation. In a young economic context, where family business founders often remain dominant in the decision-making process, the topic of succession is frequently avoided or delayed.
Following the fall of communism, Romania’s economy underwent a profound transformation, moving from state-owned enterprises to a private sector driven by local entrepreneurs. Many of these founders, now approaching retirement, are confronted with the inevitable question of succession. Unlike mature markets, where corporate governance mechanisms are well-established, Romania’s lack of formal structures, such as independent boards of directors, means that succession planning is predominantly shaped by personal preferences and decisions.
Referring to the preparation of the next generation, Adrian discussed the role of formal education versus practical experience. “Romanian founders value formal education, but they place significant emphasis on practical experience within the business. It is essential for members of the next generation to be involved early on while also being given the freedom to innovate,” he asserts.
“I built this company with my own hands, starting from nothing. I sacrificed nights, vacations, and time with my family. But now, when I think about the future, I feel lost. Who will take over? My son (or daughter) has other plans. Should I hand over the business to an outsider? Can I trust him?” These questions often weigh heavily on the minds of entrepreneurs leading family businesses.
Another aspect discussed was the influence of founders’ emotional attachment to their business on their readiness to step back. “Emotional attachment makes the process incredibly difficult.
Many founders feel that handing over the business to someone else is equivalent to losing a part of their identity,” Adrian explains. “The strategy is to acknowledge this difficulty and plan succession early, building trust and allowing sufficient time for a gradual transition.”
In Romania, succession in family businesses is more than a technical or organizational matter—it is an internal struggle. With only three decades of private economic development, many founders remain deeply involved in their businesses, viewing succession not just as a managerial transition but as a reflection of their identity, control, and legacy.
Adrian Florea’s research highlights a recurring pattern: many Romanian founders view succession as something to consider “someday,” delaying critical decisions until unexpected events, such as health crises or external pressures, force them to act. Founders are not aware of the idiosyncratic dimensions of their succession – trust and time. When family members are chosen – this decision is essentially trust driven, they are getting involved in company’s day-to-day business from an early age. Once the founder learns that the successor will not take over – reasoning varying from a simple successor career turn to a painful profiling result showing the successor lacks crucial entrepreneurial and leadership skills, looking for outsiders is the next option. In a country where trust is often scarcer than capital, appointing an outsider or non-family professional is met with reluctance and, in some cases, perceived as a personal failure. If this move comes late, there is not enough time to transfer the business – knowledge, business, and supplier networks, consultants, or bankers’ ecosystems. This is one of the reasons for 2 out of 3 businesses disappearing at first-generation succession. How to avoid it? Start early! Learn that you, dear esteemed founder, are suffering, like many entrepreneurs around the world, from the same syndrome: inability to let go. And once you are getting that, planning the succession, with the two dimensions – trust and time, will ensure longevity to a business meant to support your family after you retire. Because you will surely retire one day.
Succession, at its core, is a deeply personal story. It involves identity, trust, acceptance, preparation, expectation alignment, and implementation. For families, it is about striving to maintain unity, even if that means avoiding difficult discussions about the future. For founders, it is about recognizing that preparing a successor is not about relinquishing control but about consolidating their legacy.
Achieving successful succession requires careful alignment of values—mutual respect, trust, and a shared vision—while preparing for the personal and professional challenges of the process. It also involves creating effective communication pathways for what is, ultimately, a transformative journey. A process that takes time.
Succession is not just about deciding who will lead the business in the future. It is about ensuring that every decision reflects the values and aspirations of the person who built it.
These perspectives reflect the complexity of the succession process in Romania and highlight the need for a balance between tradition and modernization, respect for family values, and openness to professional practices.
Or in other words “The art of life is a constant readjustment to our surroundings.”, Kakuzō Okakura
12.12.2024 / Editor, Andreea Dragan
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