International Finance Corporation (IFC), a member of the World Bank Group, along with the Sri Lanka Institute of Directors (SLID) and the Colombo Stock Exchange (CSE), are collaborating on workshops that promote good corporate governance and family business practices to improve the long-term sustainability of family-owned businesses in Sri Lanka.
The first in a series of workshops was held recently with the aim of helping participants understand the fundamentals of family business governance. Family businesses are key to Sri Lanka’s economy, generating jobs and contributing significantly to the country’s economic growth. However, almost 95 percent of such businesses do not survive beyond the third generation.
“Some of the largest and most prominent brands in the country today, were initiated as a family-owned operation, and some even continue to be operated as a family business. The creation, growth and longevity of our family businesses therefore, is of national interest and we are pleased to play our part in making expertise in topics such as governance more attractive and accessible for the leadership of family businesses,” said Mr. Rajeeva Bandaranaike, CEO at the Colombo Stock Exchange.
Good corporate governance practices help companies operate more efficiently and manage risks better. IFC works with private sector companies in emerging markets to facilitate board robustness and promote sustainable practices that can help in the growth of a company.
“Many businesses in Sri Lanka, like in South Asia, are family-owned institutions, and are a vital part of the economy,” said Amena Arif, IFC Country Manager for Sri Lanka and Maldives. “Improved corporate governance practices can help such companies grow through different phases, expand to new markets and ultimately, ensure business continuity.”
IFC’s Corporate Governance program has a portfolio of over $43 million with 23 active projects across the globe. Working with over 1000 companies, IFC’s dedicated corporate governance experts have provided advisory services that helped over 200 companies improve their corporate governance practices. These companies could attract capital of over $6 billion. IFC’s South Asia Regional Corporate Governance Project, implemented with donor support from Japan’s Ministry of Finance, helps strengthen corporate governance by working with boards through knowledge sharing and trainings, regulators and other market intermediaries.