Feud in Family Business Often Leads to Company Downfall

The following is from Jonathan Guthrie, Tragic pitfalls of making an heir the boss, FT.com, Feb. 28, 2008:

Professional advisers sometimes mutter a damning phrase after first meeting an aspirant chief executive who got a job, along with his DNA, from Dad - "clogs to clogs in three generations".

Typically, Grandpa sets the business up, building it to modest size. Pa turns it into a global force across five time zones, or at least across greater Northampton. Junior runs the company into the ground through incompetence or sheer indifference.***

Still, a little greyness is better than the worst horrors of family business feuds, as explored in Family Wars.***

Authors Grant Gordon, fifth-generation member of the William Grant & Sons family, and Nigel Nicholson of London Business School provide a useful breakdown of the "monumental flaws" in the character of L.S., who died in 1999, and therefore cannot sue.***

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.