IIC and Banco de América Central team up to promote corporate governance in family businesses

02/28/2011

The workshop provided SMEs with an opportunity to learn about key aspects of family business governance with the objective of boosting their competitiveness and improving their chances at surviving generational transition.

San Salvador, El Salvador - On February 28 and March 1, 2011, the Inter-American Investment Corporation (IIC) and Banco de América Central (a member of BAC|CREDOMATIC) joined forces to offer a workshop on good governance in family businesses.

The workshop addressed the three main challenges family businesses face: developing business ownership responsibly and jointly, preparing for succession, and keeping up an entrepreneurial spirit. Spain’s IESE Business School (University of Navarra), the consulting firm IKEI, and Colombia’s INALDE business school facilitated the workshop. Similar workshops sponsored by the IIC through the Government of Spain are being held in San José (Costa Rica) and Tegucigalpa (Honduras) as part of a regionwide effort. The IIC has already offered activities to promote family business governance in Colombia, Jamaica, Panama, and Trinidad and Tobago.

"The IIC is fully committed to improve corporate governance among its clients and throughout the region. Most of our clients and SMEs in the region are family businesses, a factor that adds complexity to their governance. All family businesses involve three components: business, family, and ownership. Communication among these components is key. With this workshop we seek to provide entrepreneurs with the necessary tools to reflect on and begin to make decisions towards better corporate governance," said Michael Apel, Senior Trust Fund and Technical Assistance Officer at the IIC.

According to Raúl Cardenal, Chief Executive Officer at Banco de América Central, "Our concern with social responsibility leads us to seek partnerships that benefit our clients’ development. This is how we came to the joint initiative with the IIC to promote family business governance. Family-owned SMEs are key to our business, and one of their weaknesses is their internal governance structure. Unfortunately, we see companies disappearing when they begin the succession process or failing due to issues among family members more often than we would like. We hope that this workshop will raise businesses’ awareness of the importance of planning for succession, providing appropriate training to the members that will be entrusted with working at the company, or maintaining the founder’s entrepreneurial spirit when the time of succession comes."

About Banco de América Central

Banco de América central is a member of the BAC|CREDOMATIC financial network established more than 50 years ago. It mainly offers commercial, corporate, and consumer banking services, including a significant credit card operation. A solid and leading institution in Central America, BAC|CREDOMATIC employs more than 10,000 people in the region. On December 9, 2010, BAC|CREDOMATIC was acquired by Banco de Bogotá, a member of Grupo Aval. Grupo Aval is Colombia’s largest financial group, with nearly 30% market share.

About the IIC

The IIC is a multilateral financial institution that is a member of the Inter-American Development Bank (IDB) Group. The IIC’s mission is to promote the economic development of its regional member countries by encouraging the establishment, expansion, and modernization of private enterprises, particularly those that are small and medium in size. It does so by providing financing (in the form of equity investments, loans, guarantees, and other instruments) and advisory services to private enterprises in Latin America and the Caribbean. In 2010, the IIC reached US$1.4 billion in assets and approved forty-nine operations channeling US$374.8 million to SMEs in the region. For more information on the IIC’s activities, please visit www.iic.int

Contact: Amparo de San José Riestra

Telephone: (202) 623-3921

Email: amparori@iadb.org