Clara Demers
Manager | Human Resources Consulting Practice Leader | Business Transformation

When it comes to business transfers, setting up a family council can be a winning strategy for ensuring the sustainability of a business.

Over the next few years, many Quebec businesses will be transferred to buyers from within the family circle.

In some cases, it’s also possible that external buyers will also be involved, but the fact remains the same: multigenerational management is an issue that family businesses must face.

Starting an entrepreneurial succession process is a long and complex project. In the context of a family succession, the stakes, emotions and feelings are put to the test. It’s like airing problems and issues that are usually private.

Preserving the harmony thanks to a family council

The family council is a key structure when the family grows and the family-business relationship becomes more complex. It provides an opportunity for family members to express themselves. However, setting up a family council is not automatic.

It’s important to understand the family history, ties and relationships between family members. When we undertake a business succession assignment, it’s essential to have a human approach and a proper grasp of all aspects involved.

This is even more true in a family succession context. It’s almost like interfering in people’s private and professional lives; some discussions will be easy, but others will be more difficult and painful. The complexity of the case will determine whether or not to involve a family council. In complex family succession cases, a family council can be very useful for all parties involved.

What is seen in most cases is that when the future management team, which includes external members and others from within the family circle, meets, some things may be left unsaid. And if they are not addressed, these unspoken things can be detrimental to the proper functioning of the management team. That’s where the family council may have a role to play.

When setting up the family council, it’s important to define a broad framework and structure that includes all family members. It’s also essential to identify a common goal. Achieving this goal requires active listening and honest participation by all.

The family council’s mission is to preserve family harmony while ensuring the business’s stability. To achieve this, everything depends on good communication between the participants.

The family council as a place of exchange

Our approach to the practice is very human; our desire is to satisfy everyone, and in order to achieve this, we must let everyone express themselves and hear them. We set up a family council in which we play the role of mediator. This council meets about twice a year and offers all family members the opportunity to share their opinions and resolve certain situations.

The family council is an ideal place to communicate, exchange and set policies and procedures concerning family members, such as hiring them in the organization.

Family council sessions are not family meetings; their purpose is to resolve situations and address concerns. In a family succession context, there is tension and disagreement. Our role is to guide these meetings, but to do so, all family members must be present.

Family councils are opportunities for everyone to express themselves and be heard. It’s not about interfering in family life, but rather it’s a window where everyone can speak and be heard.

What do the external buyers think?

This approach is very well received by external parties taking over, who encourage and respect this practice. It’s also in their interest to put all the chances on their side to ensure the sustainability of the business. Moreover, the family council is not a decision-making forum, so this does not bother external buyers who are in favour of such an action. Instead, it helps preserve harmony.

Preparing the next generation

The family council also helps to raise awareness and prepare the future generation that will take over the business. By valuing members, they act on the family’s behalf to preserve its heritage, which will have a positive impact on the company’s sustainability.

For more information, contact our team.

30 Sep 2021  |  Written by :

Clara Demers is your expert in Business Transformation at Raymond Chabot Grant Thornton. Contact her...

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Jeannette Boulanger
Senior Manager | CPA, CA, M. Sc. | Human resources consulting

Everyone is talking about the labor shortage. How can we create the right conditions for hiring?

1- Look past resumes and keep an open mind

We all know there is no such thing as the perfect candidate. Skills and experience are obviously important, but it is worth looking beyond these considerations.

  • What are the candidate’s aspirations for the position and their career in general?
  • What are their areas of interest?
  • What are their core values? Are they aligned with those of your company?
  • What potential do you see in the candidate?
  • What are their short- and medium-term career goals?

By looking beyond people’s resumes, you may discover hidden talent. With enough time and training, these people could become the key players you’ve been looking for.

2- Encourage internal mobility

Keep talent within your company by encouraging workers to apply for lateral or vertical moves. Even if they don’t have all the skills required for the job, your current employees have the advantage of being familiar with the company and its values.

Finding and training external talent is costly for organizations and involves a certain adjustment period. Meanwhile, giving employees the chance to do something new can contribute to an improved sense of belonging. After all, people shouldn’t be discouraged from wanting to learn new things and expand their skill set. Not only will providing workers with in-house opportunities translate into better retention and engagement levels, it will also help employees grow at a faster pace. It is a win-win situation.

Find out more about talent development.

Find out more about knowledge transfer.

3- Assess employee wellbeing regularly

The past year has been challenging—both personally and professionally—for all of us. Psychological distress and health problems, related to COVID-19 or otherwise, plagued a lot of people. Some are still suffering. Everyone has their own way of reacting to the situation. That is why it is important to keep an eye on employee wellness indicators.

Check in with your teams on a regular basis to make sure they are feeling well both physically and mentally. This can be as simple as making informal calls, sending monthly questionnaires, or planning a lunch or virtual tour to connect with your workers and teams.

By taking an interest in your employees, you will be able to monitor their health and bolster their engagement.

Find out more about worker health.

4- Be open and flexible

Work arrangements have become a hot topic and there is no shortage of options, including: 100% work from home, 100% work from the office, or hybrid work with or without fixed days. To choose the one that’s right for your team, consider surveying your employees and asking them what they want. Since each person and business is different, look for an option that reflects your needs and goals, as well as those of your clients and staff.

Then be flexible in how you apply your policy. Today’s workers are looking for ways to balance their personal and professional lives.

Find out more about hybrid work.

Find out more about work and life balance.

5- Be real, be yourself

Cultivating solid relationships with your personnel is essential to building employee engagement. Show them that you’re human too. Express an interest in your employees and let them know that they are important to you and to the company.

Be genuine. As a manager, you can’t do everything or know everything. That is why you need to surround yourself with good people. By being open, you will gain their respect and build trust.

Find out more about how to communicate effectively with employees.

29 Sep 2021  |  Written by :

Jeannette Boulanger is a Human Resources Consulting expert at Raymond Chabot Grant Thornton. Contact...

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Katy Langlais
Manager | CRHA, MBA | Human resources consulting

Workforce shortages are a challenge and keeping your employees engaged with the company is more important than ever.

It’s important to remember that your employees are your organization’s most important asset, and one that can contribute the most to its development.

Numerous surveys reveal that employees who are strongly committed towards an organization contribute to its growth up to two and half times more than do other employees. It was observed that organizations that neglect employee mobilization risk losing their trained and experienced employees as well as the financial investment that goes along with training, recruiting and hiring new employees.

The highest performance is found in organizations that promote an organizational culture based on motivation and surpassing oneself, and that use this to attract qualified resources and retain motivated employees.

Ten tips for creating commitment

Here are ten tips that employers should keep in mind when managing daily activities in order to increase their employees’ level of commitment towards the organization:

  1. Provide a clear vision of the organization’s goals, expectations and objectives;
  2. Provide a detailed description of employee tasks;
  3. Ensure that employees understand their tasks and how they can contribute to the organization’s objectives;
  4. Provide clear feedback on the organization’s results;
  5. Recognize the efforts of committed and efficient employees;
  6. Offer competitive compensation;
  7. Provide career advancement opportunities;
  8. Offer professional development;
  9. Involve employees in decision-making;
  10. Make financial participation in the organization available.

Employees, A Key to Success

It’s generally believed that employees who feel satisfied with their professional environment work better, serve clients better, work better with their business partners and thus, have a more positive impact on an organization’s productivity. While all of this may be true, there’s more; employees would also like to:

  • Have a relationship of trust with management;
  • Contribute to the organization’s culture and values;
  • Maintain a good work-life balance;
  • Have a working environment with good team spirit and pleasant inter-professional relationships;
  • Get involved in causes that they hold dear and receive support from their employer.

Having a clear vision and an employee performance management structure based on the above are instrumental in creating an environment that is conducive to development and increasing employee commitment. Remember that employees are at the center of an organization’s success… and its challenges.

However, over and above the various initiatives that can be implemented to promote employee commitment, strong leadership is likely one of the best ways to motivate and mobilize employees.

28 Sep 2021  |  Written by :

Katy Langlais is a recruiting and human resources consulting at Raymond Chabot Grant Thornton.

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Sustainability and climate change are becoming increasingly important for organisations of all shapes and sizes.

From the perspective of the organisations’ impact on its environment, but also risks of the changing climate for the organisation. Think of:

  • extreme weather disrupting production;
  • changes in laws and regulations;
  • changing consumer awareness;
  • purchasing behaviour.

Yet, in a report published by the World Economic Forum this year, we see that in the top-five of most likely risks and in the top-five of risks with the most impact, three of the five risks are climate related. This highlights the urgency for including these climate-related risks and opportunities going forward.

Where there are risks, there are also opportunities. Opportunities around:

  • effciency,
  • positioning,
  • raising capital,
  • new business models.

How can you capitalise on these opportunities and prepare your company for the future?

What are the risks?
What are the opportunities?
What are the financial implications?
Questions you must answer?
Step-by-step plan for organisations

What are the risks?

The exact risks your organisation faces, depends on context, products, services and the business model. Generally speaking however, several types of risk may apply to your organisation. Climate-related risks can be split into two main groups, transition risks and physical risks.

TRANSITION

Transition risks are those risks related to the transition towards a cleaner, more climate positive economy. This includes the following risk categories.

Policies, laws and jurisprudence

Organisations are increasingly confronted with policies and laws related to climate. These can be aimed at accelerating the transition to a cleaner economy and, for example, stimulate organisations to emit less, to use cleaner energy or to process waste in a smarter way. A concrete example is the upcoming CO2 tax.

Recent years have seen a substantial increase in climate-related court cases against organisations, e.g. the current climate case against Shell. Cases have been made for not (timely) preventing an organisation’s negative impact on the climate, not anticipating (damages and loss through) climate change (think of extreme weather such as draught and floods) and insuffcient transparency about financial risks (e.g. to shareholders) following climate-related events.

Technological risks

Technological innovations related to the transition towards a cleaner economy, can also provide both opportunities and risks for operations. Think, for example, of renewable energy, storage of CO2 and hydrogen as fuel. When an organisation depends for a large part on ‘old’, polluting technology or fuel, for example in production or distribution, these new technologies can prove disruptive to operations.

Market risks

Changes in supply and demand can pose risks for organisations. What are your supply-side dependencies? You may face problems as a result of a reduction in the raw materials available or the failure of harvests due to extreme weather. On the demand side, there’s a reduced demand for products and services with a negative impact when it comes to sustainability. We see this both in B2B and in B2C business models.

Reputational risks

Social awareness around climate change, and the responsibility companies have to reduce their impact, is growing. If an organisation does not cater to this, they may face reputational risks. This could be through reduced demand, because consumers increasingly choose organisations that have a (more) positive impact on humans and on nature, or, for example because they find it diffcult to recruit and retain staff.

PHYSICAL

Physical risks are directly related to the weather and linked to climate change. These risks can be either incident-driven (acute in nature), or chronic (as a result of permanent, long-term changes in weather patterns).

Acute risks

Risks related to specific incidents, such as extreme weather conditions. Flooding or cyclones, for example.

Chronic risks

Risks that are related to changes in climate patterns, such as heat waves, drier seasons and higher sea levels.

Like with transition risks, physical risks often lead to financial implications for an organisation, such as damage to possessions or disruption in the availability of goods or raw materials, loss of quality or safety of employees.Colloque Fiscalite internationale

What are the opportunities?

Where there are risks, there are also opportunities. Here too, specific opportunities for your organisation will depend on context and on the business model, but on the whole, opportunities arise in the following areas.

Efficiency and cost-saving

Innovations in the field of sustainability can lead to improved efficiency in, for example, production or distribution processes, but also within the organisation internally, through more efficient buildings, a better use of resources through recycling, or through the use of circular models. With potential cost savings as a result. The subsidies around sustainability also provide plenty of opportunities for organisations.

Positioning and reputation

Changing customer awareness is leading to changing demand. More and more organisations are acting on this by taking a position when it comes to climate change and improving the sustainability of their products, services and business models. This also helps them to become more attractive employers.

Market

Sustainable positioning creates market opportunities. By developing new business models, opening up new markets (think of governments who increasingly offer contracts to sustainable partners), and in raising new capital for organisations. These days, investors prefer to do business with an organisation that has a sustainable strategy.

Continuity

Ultimately, by adjusting business models to incorporate climate change, sustainability and impact, you will create opportunities for the healthy continuity of the organisation. There where others fail. Making your organisation future-proof ensures that you remain relevant in the market and for your clients, and that you are able to positively answer the question: ‘Will my organisation exist in 10 years’ time?’

What are the financial implications?

Management information often makes a distinction between financial information and non-financial information. Non-financial information relates to the key performance indicators (KPIs) related to people and planet, e.g. an organisation’s CO2 emissions, waste flows, HR and diversity policy. Such non-financial information is crucial for charting and anticipating climate-related risks and opportunities.

When it comes to organisational strategy, however, this distinction between financial and non-financial information does not make much sense: increasingly, climate-related risks and opportunities can have large impact on an organisation’s financial performance.

Questions you must answer?

What role will climate and sustainability play for your organisation and where should you start in order to include this in your organisational strategy? Relevant questions to answer in this regard are:

  • Which climate-related dependencies and risks does my organisation face, in which timeframe, and to what extent?
  • What are the opportunities, e.g. in the field of product development, positioning or financing?
  • What are the financial implications when these risks and opportunities materialise? How will this affect the business case?
  • What could and should I anticipate in order to ensure my organisation’s continuation? What are the costs involved?
  • How can I embed steering and managing of these types of opportunities and risks in company processes?

Step-by-step plan for organisations

1. Analysis of dependencies, risks and opportunities

  • Which climate-related matters does the organisation depend on (raw materials, land, supply chains, technology, people, possessions, etc.)?
  • What climate-related impact (negative and positive) does the organisation create in its production cycle, operations, products and services (emissions, water, waste, biodiversity, ecosystems, materials, people)?
  • Which material risks does the organisation face (transition risks and physical risks)?
  • Which opportunities are there in the field of climate and sustainability for the organisation (positioning, efficiency, cost-saving, future-proofing)?
  • What are the potential financial implications of risk and opportunities (based on scenario analyses and forecasts)?

2. Sustainability strategy

  • How can the organisation anticipate risks and opportunities?
  • What is needed (materials, capital, stakeholders, positioning), and in which timeframe?

3. Monitoring and reporting

Monitoring KPIs and non-financial information to check on environmental performance and on progress of the strategy. This enables timely adjustments and allows you to quickly spot new risks and opportunities.