Rising above: How to succeed as a non-family chief executive

Stamping your authority early and rising above family politics is essential in being successful as a non-family executive in a family business, says Michele Norsa, the former Salvatore Ferragamo chief executive and Italian family business guru.

Norsa (pictured left) has a distinguished history of leading and sitting on boards of multigenerational family-owned companies in the global luxury industry. He served in roles of high responsibility and influence at Salvatore Ferragamo, Gruppo Valentino, Marzotto, Benetton, Davidoff Group, Rocco Forte Hotels, Ermenegildo Zegna Holditalia, Biagiotti and Missoni.

The 71-year-old Italian family business veteran was recognised for his leadership, adherence to family values and culture, and achievement in growth and profits by his peers when he won the Top Non-Family Director Award 2019 at the CampdenFBEuropean Families in Business Awards in July.

Speaking to CampdenFB about his experiences of working with business families of wealth, Norsa said the key to effectively enter and lead a family-owned company was to quickly establish governance among family members.

“When it comes to these big multigenerational families, I try and re-establish the equality of different families and the first thing I do is give off the impression of being absolutely above any kind of politics and being completely independent, even from the principal,” Norsa said.

“If everyone has an office, an assistant and one car, but there is one that has three and is charging the company for security at his or her villa, then you have to establish rules where everyone is on the same leg and you have to do it immediately.

“If you wait too long, you can start getting involved in family politics, you may get closer to one member of the family more than another and then, suddenly, you are part of the problem.

“You have to build a solid basis where the rules are very clear, but the most important is being impartial—never participating in family issues. This is how you gain trust and authority.”

Mediation and communication

In this year’s Global Family Office Report 2019, Campden Wealth with UBS found improving communication between family members and family office was the number one governance priority for families over the next 12 to 24 months (66%), while educating family members about the activities of the family office (55%) came second.

Norsa said, as a non-family executive director, another vital part of his job had been to 

act as a liaison between generations to ensure mutual understanding.

“A lot of what I do is to make sure there is good communication between family members,” he said.

“For example, I am working with one family and I was hired by the father and son to act as a mediator between them, treating them with the same distance as each other, but making sure there is a continuous flow of information from one side to the other.

“For example, the son says the company is doing very well, the father says no, there is a fight and I sit them down together and try to work for the two parts and be as impartial as possible.

“It is a delicate situation, but as long as you are looking at the situation with an independent eye, the sides can come together and talk, no problem.”

Family tensions

However, for families who are thinking of hiring a non-family executive director to assist them navigate business and family, Norsa said it was important to ensure all members were willing to play ball.

“It is no use paying money for a good executive director if relationships are so toxic that members are not willing to come together,” he said.

“Two or three times I have refused to enter the board of family companies because there was too much war and tension inside, for example, one family told me there was a chairman and two chief executives—two sons who said they were never going to sit at the same table—and I said I could not go and talk to each of the sons and then go to the father.

“In this situation, I believe it is something the family need to resolve a little first before propositioning me.

“Yes, we can help mediate, negotiate and that is part of the job, but if the family let difficult relationships escalate to a level that cannot unfold, it makes it much too difficult to work for the family.”