Deloitte: Family-owned businesses make up largest sector of GCC economy

Updated 30 June 2014
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Deloitte: Family-owned businesses make up largest sector of GCC economy

Around 80 percent of nonoil GDP within the Middle East region is accounted for by family-owned business groups. Typically, these privately-owned organizations span multiple business, are vertically integrated, own sizable real estate portfolios and their operational control is still maintained by the original founding family member or the second generation.
For many families in business, the rapid pace of change and growth in the marketplace presents significant concerns regarding the manner in which they will continue to safeguard and preserve their heritage and wealth.
Family-owned businesses in the Middle East face a range of challenges that affect not only the success of the business itself, but also the professional and personal goals of their owners and their stakeholders at large.
Walid S. Chiniara, an international lawyer with over 30 years’ experience across the five continents and a leading family business adviser, has joined Deloitte as the partner in charge of its Private Client Services practice (PCS) across the Middle East.
PCS is a private client-focused practice, that brings in Deloitte’s multi-disciplinary professionals to offer families in business and next generation family business entrepreneurs in the GCC and the MENA region bespoke and region-specific solutions in the area of family governance, succession planning and generational change, wealth management, tax structures and exit strategies.
“This is an exciting time for the Deloitte family and I am pleased that Walid Chiniara, one of the most experienced Family Office Advisers in the Middle East, is joining the firm to lead the Private Client Service (PCS) unit,” said Omar Fahoum, chairman and chief executive at Deloitte Middle East.
Deloitte recently conducted a survey on family-owned businesses to assess two specific areas that have an impact on their companies’ operations and growth: governance and succession.
The findings of the survey based on the input of 222 survey respondents indicate gaps in governance, board operations, and succession planning.
Other key findings of the survey include:
Nearly half (49 percent) of respondents say they only review succession plans when a change in management requires it and 41 percent do not have leadership contingency plans.
More than 80 percent of respondents say their boards have no term or age limits on membership and one-third do not evaluate board members’ performance.
Deloitte believes that the needs of families in business are different from those of public corporations. Therefore, Deloitte Middle East’s Private Client Services offering is continuously adapting to ensure that it addresses all facets of a family’s wealth, including its human, intellectual, cultural, and financial capital.
Nauman Ahmed, regional tax leader at Deloitte Middle East, comments: “The aim of the PCS division is to provide business families with the tools they need to preserve and grow their wealth — both now and for generations to come. The appointment of Walid, with his extensive experience working closely with families in business, will further support our ability to better serve our clients and build on the technical capability that Deloitte is renowned for”.


Flight rights group takes Ryanair to court over strike compensation

Updated 15 August 2018
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Flight rights group takes Ryanair to court over strike compensation

  • Ryanair had to cancel around 1 in 6 flights last week due to a walk-out by pilots in five European countries
  • The disruption affected 55,000 travelers

BERLIN: German passenger rights company Flightright is taking Ryanair to court over whether it should pay financial compensation to passengers affected by strikes at Europe’s largest low-cost carrier.
Ryanair had to cancel around 1 in 6 flights on Friday due to a walk-out by pilots in five European countries, disrupting an estimated 55,000 travelers.
The worst affected country was Germany, where 250 flights affected around 42,000 passengers.
EU rules state that passengers can claim monetary compensation of up to €400 for flights within the region for canceled or delayed flights, unless the reason is extraordinary circumstances, such as bad weather.
Strikes have generally fallen under extraordinary circumstances although a ruling by the European Court of Justice in April said that a wildcat strike by staff at German airline TUIfly following a restructuring could not be classed as extraordinary circumstances. Flightright said it believes Ryanair is therefore obliged to pay monetary compensation to customers and so has filed a complaint with a court in Frankfurt in a bid to clarify the rules around strikes.
A spokeswoman for the court said she was aware of the Flightright statement, but that she had not yet seen the complaint.
Ryanair said it fully complies with the European legislation on the matter, known as EU261.
“Under EU261 legislation, no compensation is payable when the union is acting unreasonably and totally beyond the airline’s control. If this was within our control, there would be no cancelations,” a spokesman said.
Passenger rights groups such as Flightright help passengers to claim compensation from airlines under EU261 rules but in exchange for a share of the compensation received.
Many European airlines, including Ryanair, therefore urge passengers to file claims with them directly instead.