The family/business balance in selected Maltese SMEs and the role of the financial advisor

Abstract

Purpose: This study aims to gain an understanding on the Maltese family business environment with regards to three particular aspects each expressed as a research objective; to determine whether family businesses are business/family focused, to analyse the governance structures within such firms and to identify the most common business advisor amongst Maltese family businesses. Design: This study primarily focuses on small enterprises. Data was collected via a structured questionnaire distributed to a selection of Maltese family businesses. Findings: The findings indicate that the majority of small firm respondents are business focused. Conversely, a more convincing majority of micro enterprises are family focused. Formal governance structures, policies and procedures are practically nonexistent among the respondents. The results of the study indicate that the management consultant is the most common business advisor among small firm respondents whilst the accountant is the most common business advisor amongst micro enterprises. Conclusions: Such results suggest that although it is positive that the majority of small enterprises are business focused, the fact that micro enterprises are outright family focused implies that one should not be tricked into perceiving the results to be a precise reflection of the Maltese family business environment. Much more has to be done to educate and support family businesses to implement the formal governance structures that could be crucial to the firm's stability, sustainability and success. Besides, accountants are not yet providing the wider support role that they could and should be providing with the knowledge and skills at hand. Value: All this implies that although there are a number of encouraging signs, much more must be equipped to guide Malta out of the economic crisis that has hit the world.