In May 2023, the Dubai Centre for Family Businesses (the DCFB) was established under the umbrella of the Dubai Chamber of Commerce to help ensure the sustainability and growth of family-owned businesses in the emirate. In July 2023, the DCFB introduced the Governance Guide for Family Businesses (the Guidelines). The aim of these new Guidelines is to provide advice to families and encourage them to develop robust governance frameworks to ensure the continuity of their businesses. The Guidelines and their accompanying resources have been developed to help families navigate this process and map out the complex roles and relationships that ultimately define their businesses.
The Guidelines are designed to promote:
- International Best Practices: The Guidelines incorporate international best practices that have been tailored to suit local requirements. They also provide advice around the importance of developing a Family Constitution or Family Charter.
- Sustainability of Family Businesses: The Chairman of the Dubai Chamber of Commerce, Mr Abdul Aziz Al Ghurair notes that the Guidelines provide, "a comprehensive and integrated vision that will assist companies in developing effective strategies for seamless leadership transitions across successive generations.” With many family businesses established during the 1950s and 1960s, these entities are expected to undergo an intergenerational transition within the next five to ten years. Consequently, an estimated USD 1 trillion (AED 3.67 trillion) in assets across the GCC will be transferred to the next generation during the following decade and families need to have clear and long-term strategies in place.
- Strong Foundations: The Guidelines provide tools to facilitate open discussions in a trusting and transparent environment. These include programmes designed to prepare new leaders, educate family members on important succession planning issues, and raise awareness about general governance matters.
- Sustainability and Growth: Family businesses account for approximately 90 per cent of the UAE’s private sector and make a substantial contribution to Dubai’s non-oil GDP. Family businesses have also been at the forefront of Dubai’s economic diversification, with a significant presence in a variety of industries from construction to tourism. The Guidelines look to foster the development of this important sector by providing educational resources and policies to families and those that advise them.
The DCFB Guidelines are a welcome addition to the existing regulatory framework and other guidelines already in place to support Dubai’s many family businesses. We anticipate that the Guidelines will cement and further enhance what is already a thriving economic ecosystem by providing a stepping stone to continued growth and prosperity.
Established under the Dubai Chambers in May 2023, the Dubai Centre for Family Businesses is entrusted with ensuring the sustainability and growth of family businesses in Dubai.