Saudi women’s role in family businesses still limited

The number of Saudi women in leadership positions in family businesses is still very limited, said Josiane Srih, associate professor at the Lebanese American University.
Srih participated in a workshop entitled “Activating women’s role in family businesses,” as part of the event “Women’s Work … New Horizons” that the Eastern Province Chamber organized.
The Lebanese American University conducted a study recently, which showed that women constitute 49 percent of the employees in administrative and professional positions. The study showed also that only 6.2 percent of women hold senior jobs such as CEO, or vice CEO, out of the total number of employees at 500 large corporations in the US.
“Family businesses constitute the largest percentage of the total number of enterprises that run the national economies in several countries of the world,” said Srih. Such family businesses accommodate large numbers of work force, supply diversified products to the market, realize the bulk of savings and contribute to the foreign trade of the country, she added. “These businesses form about 85 percent of the total number of registered firms globally.”
Listing some challenges that these businesses face she said: “The poor long-term strategic planning is the most obvious challenge.” Choosing a successor when the founder dies unexpectedly is difficult, in particular if the borders between ownership and management are vague,” she explained. “Then there is the issue of cash availability and the differences between family members on decisions such as selling or buying.”
International scientific studies show that the starting point of any family business is with the second and third generation.
“About 66 percent of international organizations move from the first to the second generation, but only 13 percent move from the second to the third,” she said.
The other challenges involve the parental approach of management and the conflict of interests between the fiscal position of the company and family interests. The decision-making process is influenced with the increasing number of family members involved throughout the years, and the expanding volumes of investment.
Srih referred to other outside factors that might affect family businesses. They include government spending, the implications of new economic regulations, and globalization.
Speaking about women participation in family businesses globally, Srih said that women lead 24 percent of family businesses. “Here in the Kingdom, 95 percent of Saudi family businesses contribute to investments of more than SR 260 billion. That is 25 percent of our GDP,” said Srih.
The workshop also discussed the economic implications of family businesses on the Saudi economy. “They represent a main economic tribute to the Saudi economy by creating jobs and participating in the current process of Saudization.”