The Lagos Business School (LBS) has issued a stark warning regarding the challenges facing family-owned businesses in Nigeria, attributing their potential collapse to poor governance and weak succession planning. The school emphasized the necessity for these enterprises to establish formal governance frameworks to ensure clarity in roles, expectations, and decision-making processes, which can significantly aid their sustainability across generations.

During a recent webinar titled 'Next-Gen Ready: The Family Business Success Blueprint', Dr. Okey Nwuke, the Director of the Family Business Initiative at LBS, highlighted that many family businesses tend to fail after the founder's generation, primarily due to ineffective governance systems. He pointed out alarming statistics, noting that over 70% of family businesses worldwide fail to survive beyond their second generation, indicating a crucial need for intentional governance and structured succession planning.

The call from LBS serves as a wake-up call for family enterprises to rethink their operations and governance structures. With proper frameworks in place, these businesses can enhance their chances of long-term success, paving the way for future generations and ensuring their legacy continues. This situation holds significant implications not only for individual businesses but for the broader economy, emphasizing the need for strengthened governance in the family business sector.