In executive search, family firms prefer to keep it in the family

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Few owners of family businesses in Hungary consider selling their company when the issue of a generation shift arises within the firm, according to a joint survey by consultancy firm BDO Hungary and company information provider Opten.

A large majority of family businesses are facing the issue of a generation shift, reveals the survey, cited by current affairs news portal hvg.hu. Founders of companies started in the early 1990s are now at the age of retirement and need to decide about the future of their companies; in this case, changes can prove difficult.

BDO and Opten surveyed almost 200 family-owned companies, of which 84% are run by the owners themselves.

Regarding their intentions, only 18% of owners said they are considering selling their company. While 47% of respondents would hand over the running of their company to other family members, 17% would find other in-house leaders. Only 10% would hire outside experts, and even in this case they would only hand over operative tasks, the survey reveals.

As for the profile of new executives, respondents indicated that he or she must have extensive experience in the field, as reflected in the expected age of candidates of between 33 and 49. Ideally, the new head of a company would be someone already working there, according to 66% of respondents.

Tamás Tóth, CEO of Opten, told hvg.hu that a surprising finding of the survey is the rejection of multinational companies. Only one third of respondents said that a new executive should have experience acquired at multinational companies, while 81% specifically rejected the idea of employing consultants from this area in the process of executive selection.

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