The role of sons-in law in family businesses

Family businesses have traditionally focused on the eldest male son as the potential successor. This is not my opinion, I must clarify, but just a statement of fact of the traditional thought that existed in earlier times.

This school of thought stated that the eldest male child would take over the family business, and hence his training began early. He was expected to assume the role of the family patriarch, which came along with responsibilities of looking after the “weaker” members, ensuring the pooling of family incomes and a socially acceptable (at least in his opinion) distribution of this income; along with investing in, and being the trustee of all the family assets.

This also meant that the duties of the eldest son were socially defined and rebels were ostracised for not fulfilling their responsibilities. These sons were expected to sacrifice their own good for the greater good of the family. I have seen many family patriarchs who have taken this one step further, and have sacrificed their own immediate family for the sake of other family members. This ensured a sustainable family structure, with the strongest and most capable earning, and the relatively weaker ones being taken care of by the others in the family. The system worked as long as all the members agreed to work within the rules set by the society or the eldest patriarch. The eldest son’s siblings were also expected to work within these rules according to the wishes of the patriarch.

Thus, we can see that the role of the eldest son was critical in the social fabric of the traditional business family structure.

Soon, this structure started getting weakened with the eldest choosing to shun such roles and seeking their independence. Also, these structures were of no use in families with only daughters, and daughters weren’t given the recognition of a successor earlier, since it was still a male-dominated society. Enter the son-in-law.

The son-in-law was considered as a proxy for the family’s wishes and was expected to take on the father-in-law’s role, for which he was groomed accordingly. This was considered a solution for the society’s need for a male heir. The father-in-law would probably have kept a keen eye for such capable persons, to whom he could hand over the reins to.

We also see such traditions in different parts of the world, including the U.S. and Japan. I was told by the member of a U.S.-based business family that the sons-in-law in their family got a lot closer to the wife’s side of the family and over time. It often happens that fathers-in-law hold their son-in-law in higher esteem, compared to their own sons, depending on their capabilities. And this could be the genesis of future conflict, as I will explain later.

Japan also has a similar tradition where the parents in a business family pick a husband for the daughter, with the expectation that she would marry him, and he would run the family business. The family would also adopt the husband so that he could assume the family name.

There have been other cases where the family has chosen to adopt a male child, sometimes from a brother or relative to carry forward their legacy. This has worked for business families thus far.

Though the daughters of many business families have proved their worth, the onus of taking a family forward still lies with a male heir in many cases. And in the absence of a son the son-in-law is co-opted for this purpose.

The son-in-law taking over the family business is a complex proposition. Many family businesses are concerned about their legacy, over immediate profits and legacy is not something that an outsider coming into the family can always fully appreciate. In families where sons-in-law coexist with other male heirs, the patriarch may also use the situation to foster healthy competition in the best interest of the business. But this also runs the risk of strained relationships among the next generation at a later stage.

However, leading a business needs the leader to operate from a position of trust, and only a few selected members can be trusted to run, and not ruin the business. Therefore, in the absence of any other competent successor–male or female–there is merit in asking the son-in-law to do so, provided he is competent to handle this business. After all, a family business should be run by the most competent individual or individuals and not necessarily the next in line in the family. The lives of the people working in the business and the family’s investments depend on it.

Views are personal.

The author is a professor of strategy, family business and entrepreneurship at the S.P. Jain Institute of Management and Research, Mumbai.