Code of Conduct – A different Perspective

Conflicts amongst family members can be time-consuming, costly, and have damaging ripple effects throughout the family-run organization. It will be in the interest of the Founder to resolve family conflicts before they become irreconcilable differences. Most conflicts in family business arise due to objectionable and detrimental behavior of the family members.

The principal cause of such conflict is lack of clarity and transparency regarding the organization’s expectations, rules, and regulations, insufficient or unsuccessful communication, and lack of or unfair enforcement of these mandatory systems.
A fair and reasonable code of conduct can go a long way in preventing conflicts among family members.

A well articulated code of conduct would be specific, easy to understand and implement, and also state the adverse consequences of not adhering to the rules will go a long way in maintaining the much needed discipline in family meetings. Each family member should consciously be aware and uphold the rules so stated.

Ownership of formulating the code of conduct should rest with a senior family member or a group of family members. Based on feedback received from members rules would be amended / added and the revised rules should be intimated to all family members.

They should also be responsible to enforce the rules and take appropriate measures in case of a breach. The acceptance and impact of the code of conduct depends on how transparently the internal rules are being enforced and managed.

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