Securing the Future of Family Businesses in East Africa

A startling reality confronts East Africa’s business landscape: fewer than 20% of family enterprises successfully transition beyond the second generation. This alarming statistic reveals fundamental weaknesses in how family businesses approach succession planning and leadership transitions. The root causes of this failure are multifaceted, ranging from informal governance structures and ambiguous succession roadmaps to generational resistance against change and limited access to professional guidance. Many small and medium enterprises (SMEs) find themselves unprepared when the time comes to pass the torch, often resulting in operational instability, family conflicts, and, in worst-case scenarios, complete business collapse.

To address this critical challenge, Strathmore University Business School (SBS) partnered with Oikocredit, Oikocredit International Foundation, the Smallholder Sustainability Upscaling Programme (SSNUP) coordinated by ADA asbl, and the African Guarantee Fund to implement a comprehensive technical assistance program. This initiative targeted family businesses in Kenya and Uganda, equipping them with essential tools and knowledge for effective succession and governance planning.

The Programme’s impact has been significant, reaching 17 businesses and engaging 43 family members through intensive training sessions. Participants benefited from over 90 personalized coaching sessions, while nine families successfully developed formal constitutions to institutionalize their governance structures. These numbers represent more than just statistics – they reflect tangible progress in building resilient family enterprises.

Speaking during the graduation ceremony on 2^nd July 2025, Carlijn Speelman, Global Capacity Building Specialist at Oikocredit, perfectly captured the Programme’s essence: “Family businesses need both practical tools and a shift in mindset to move from day-to-day operations to long-term sustainability.” This dual approach formed the cornerstone of the intervention, focusing on three critical areas.

First, the Programme helped families establish robust governance frameworks, clarifying roles, decision-making processes, and conflict-resolution mechanisms. Second, it guided businesses in developing clear succession roadmaps, ensuring the identification and proper preparation of next-generation leaders. Finally, it addressed financial and legal preparedness, emphasizing the importance of appropriate documentation and risk management for seamless transitions.

The success of this training Programme demonstrates that with appropriate support and guidance, family businesses can overcome the challenges of generational transition. It proves that breaking the cycle of short-lived enterprises is possible when businesses adopt proactive planning and institutionalize governance structures.

For family business owners across East Africa, this Programme inspires and calls to action. The lesson is clear: investing in succession planning today isn’t just about preparing for tomorrow—it is about ensuring the legacy and longevity of the business for generations to come.

Do you run a family business? The Family Business Executive Programme is designed just for you! Designed to address the unique challenges faced by family-owned enterprises in Africa, it equips family business leaders and next-generation successors with practical tools and strategies to ensure sustainable growth, effective governance, and successful intergenerational transitions. Through expert-led sessions, peer learning, and real-world case studies, participants gain insights into succession planning, conflict resolution, financial management, and strategic innovation tailored to family business contexts. The program’s holistic approach strengthens business operations and helps families navigate the complex dynamics between personal relationships and professional responsibilities. August 2025 intake for this Programme is ongoing!

Learn more ici.

Article de Juliet Hinga