HKUST Business School Magazine

Establish a family council In his case, that meant setting up a family council to handle such matters, along with inviting respected outside experts to offer advice and bring objectivity to the discussions. This helped to set clear criteria for what sort of person any successor must be, and what experience, general qualifications and track record are required. “Traditionally, most Chinese firms base succession on seniority, but the eldest son or daughter might not be the best candidate,” Lo says. “That’s why I emphasize there should be a proper procedure in place.” Having that procedure in place, he believes, would help to promote overall harmony, as do the annual family gatherings which take place. The agenda for these meetings may include a review of results and achievements for the past year. But they are also an opportunity for individuals to put forward ideas, report on personal initiatives, flag concerns, or simply say what’s bothering them. “Meetings and constant communication are vitally important, so that everyone feels part of the bigger group,” says Lo, who also organizes a separate business council where he expects his two children and other chosen advisers to have a full say. “I need to allow them to voice their opinions, but most of the time when there are difficult opinions they still look to me for decisions. When the patriarch is still around, it is much easier.” As part of the general training process, his children have had the chance to take a leading role in key businesses or sit on the board as a controlling shareholder. In this way, they have gained a view of macro conditions and come to understand the work of a chief executive in managing teams, implementing strategies, timing investments, and achieving objectives. “But the family should not always intervene in the management of the business if they hire someone from outside to run it,” Lo says. “High-caliber people won’t accept that.” Shui On Group Established in 1971, principally engaged in property and construction businesses in Hong Kong and the Chinese Mainland Corporate culture and long-term objectives emphasize commitment to quality, innovation and excellence Striving for Excellence Biz@HKUST 18 Cover