‘We need Dubai’s family businesses to govern their futures better’: Osama Seddiqi
As head of Dubai’s Family Business Advisory Committee, Osama Seddiqi is working to a plan
Dubai: An eye-watering $1 trillion worth of assets held by families and family-owned businesses in the Gulf is forecast to pass from one generation to the next over the coming 10 years.
That’s a number of people - bankers, consultants, family offices - in the know agree upon, give or take a few million here and there.
Of this $1 trillion, a sizeable share will pass on as succession in Dubai and the UAE. Osama Ibrahim Seddiqi wants to make that process as smooth as possible - and, as important, involve all members of a family business in the generational shift.
This comes from Seddiqi’s recently minted role as Chairman of the Family Business Advisory Committee formed under the Dubai Chamber.
“In the past, when it was the father and the son or children, the communication was easy,” said Seddiqi. “Taking decisions on behalf of the business was much easier. Now it’s bigger.
“We need UAE’s family businesses to govern their futures better as it’s becoming more complex. That’s why it’s important to make them aware of where the business is at and how to grow it.
“There is an important program that the Family Business Center provides to non-active family members. So, raise their awareness on how to make decisions (related to the business), how to be represented in the board.”
There’s much riding on how that transition from today’s generation to the next can be effected. In the UAE and the Gulf, systemically important business groups are taking those decisions and making change happen. Done well and planned well in advance, the process can happen seamlessly. To get it wrong, the untangling can be quite difficult, as many businesses - and succeeding generations - have found to their cost.
In the UAE, helping family businesses handle change has been taken up at the federal level, with enabling laws announced. It’s also happening at the emirate level. In short, offer local family businesses all the support systems and safety nets they need.
“There is no one rule of thumb that can fit every business - but there are layers of family protocol. Where you have the ownership, management, succession planning, and have the (systems for conflict resolution.
“There are many advisors, many companies that provide these types of services to family businesses but then, as the Family Business Advisory Committee, we also tell them what are the ways and how to achieve that.
“We don’t have a template for the families to just come and sign up.”
Not for disputes
Seddiqi makes one point clear enough - “We are not a dispute center. We are going to work on enhancing the management, of how to carry forward their business for many more generations to come.
“The conflicts (within these businesses) are not within the jurisdictions of the center.” (The UAE has been bringing to speed dispute resolution entities specifically empowered to handle family businesses.)
A switch from banking
Seddiqi knows a bit about how to map out those strategies. A former banker, Seddiqi is Vice-Chairman and Chief Financial Officer of Seddiqi Holding, the Dubai-headquartered luxury-focussed retail group representing some of the finest watch brands in the world.
Rolex, for one.
“We have been hiring a lot of people from outside to take us to the next level,” said Seddiqi. “As a family, there is a way for us to enter the business, it’s not like ‘I graduate and I enter the business’.
“For me to be in this position, it’s a journey of 16 years working with the family. When there is some expertise that we don’t have within the family, we look outside and we bring that into our business.”
Thinking beyond watches?
Ahmed Seddiqi & Sons - the flagship of Seddiqi Holding’s business empire - has been focused on luxury watches and jewellery for 70 years now. Another business unit - Mizzen - was launched in 2017, which has the rights for Aesop Skincare; Gentle Monster, an eyewear company from South Korea, and Orlebar Brown, a ‘resort wear’.
“We are looking for unique brands that we can offer to our clients in the UAE - and also in the region,” he said. “We are getting into that diversification.”
But couldn’t the venturing out into new markets have happened earlier?
“Yes, we could have been there five years ago - but then we would like to take our time,” said Seddiqi.
“It’s never too late. Maybe it’s different to how others do it, but there is nothing wrong in going immediately or going later on.”
Osama Ibrahim Seddiqi does know a thing or two about timing...