The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Milo B. Butler & Sons’ president believes too many Bahamians have lost sight of the principle that “family comes first” in today’s ever-more materialistic economy and society.

Franklyn Butler II, explaining how his family were able to pull together as the business transferred control to the ‘third generation’, told Tribune Business that they never forgot the vision and core values set by its initial founder - former governor-general, Sir Milo Butler.

And, contrary to popular belief, Franklyn Butler said it was possible for Bahamian family-owned businesses to have both - a strong family and equally strong business - provided there was full transparency and the needs/expectations of all members were met.

He himself knows how hard this is to achieve, having spent the past six years keeping the Butler family together - and the business moving forward - following its transition to ‘third generation’ management control.

With more than 40 third generation or ‘G3’ members to keep happy, and no formal shareholders or profit-sharing agreements to guide them, the Butler family set up a family assembly (or family council) to give each member over 18 a vote - and say - in the business.

This process, in the making since 2008, will this year see the directors and management at Milo B. Butler & Sons meet in the company’s first-ever management conclave.

They will hear the family’s goals for the business and “develop timelines to accomplish these things that the family wants the management and employees of the business to focus on”.

“For us, family is more important than money,” Franklyn Butler told Tribune Business, “and that is very much missing in an economy that is getting more materialistic every day.”

Suggesting that this was providing a platform for many of the Bahamas’ social ills, he added that too many were placing irrelevant needs and desires ahead of what family should be all about.

Franklyn Butler said it was key for Bahamian family-owned businesses, which form this economy’s backbone, “to learn to value and respect other people’s differences”.

His cousin, Antoine Butler, head of the family assembly and a Milo B. Butler & Sons director, added: “We were all raised in a model where family comes first.

“We have to set an example for the community and maintain a legacy, and that’s what we strive to do. All of us, in the decisions we take, say: ‘What would daddy say? What would his input be?’

“These are the values that help to govern a lot of the decisions we Butlers make, both from the family and business side. The business is only one aspect of it.”

“Private, family-owned businesses have traditionally been the cornerstone of the Bahamian economy, allowing locals to reap the benefits from being entrepreneurs while simultaneously creating employment for hundreds of their countrymen.

However, succession planning in such companies has long been a common problem, impacting growth at both the business level and for the wider Bahamian economy.

The ‘founding’ and/or ownership generation often fails to leave wills or directions for who is to run the business, their expectations for their children, and how the shareholding structure breaks down - an especially acute problem among large families.

Antoine Butler added that “the founding generation” had to determine whether the business was to be passed on to their children, or if it was just for them. Another issue was whether the children would want to take on the business.

“How do you provide for the children and preserve the business for the long-term?” Mr Butler asked. “Somebody has got to be the decision-maker. Children have to know how to reach the expectations.”

Both Butlers said estate planning is different from business governance, suggesting that the two parallel processes be treated differently.

While estate planning determined which child was left what, Franklyn Butler said of governance: “There has to be a clear indication of who is in charge after daddy has gone.

“Given that death is such a finality, no one wants to talk about it. They find it very uncomfortable. And seniors find it very difficult to let go of control and power in the business.

“They see it as the next generation is never quite ready. We struggled with that in our family. The second generation never felt the third generation was quite ready.”

Asked how Milo B. Butler & Sons managed the generational transition, Franklyn Butler replied: “How did we manage it? With a lot of prayer, and what did it was a desire to be open and transparent, to be quite frank.

“The overwhelming message from the family was that they wanted to know what was going on in the business. Everyone had a different interpretation of what had gone on and transpired in the business.

“We focused on the values, even though we differed on many substantive issues. We decided we were not going to give up. We decided to bring different resources in. We showed up every day, and tried to work through it, finding systems that allow us to make decisions for all as best we can.”

Antoine Butler said the family seeks to be “inclusive”, with constant communication the key. As family assembly head, he is the focal point for disseminating information on the business, while acting as a conduit for any issues/grievances that family members may have.

“To have a strong family or a strong business. People think these two things can’t happen; they think the two are mutually exclusive. You can have a strong family and a strong business,” Franklyn Butler told Tribune Business.

“We have so many issues to fix around governance, but this [the management conclave] is a great first step. I think we’re well on the way. The processes are in place to address some of the concerns.”