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Family Businesses: Heirs Prefer Ownership Without Management

The management of Plodine, the largest Croatian company that can be said to be in family ownership, was strengthened this spring with a new member. After preparing for this for ten years in the position of Chairman of the Supervisory Board, Luka Ćurković, one of the two sons of the founder and sole owner of the company Mile Ćurković, joined the management of Plodine. At the same time, Luka’s brother Filip took over the vacant position of Chairman of the Supervisory Board.

Sixty-three-year-old Mile Ćurković has also (for now, it seems, conditionally) determined who will be his successor in the key management position at Plodine with these personnel changes. He appointed his son Luka to the management for a period of five years, just enough time for young Ćurković to prove himself capable of leading the company until he retires. What can also be concluded from these moves is that the owner of Plodine intends for the company to remain in family ownership for at least one more generation and that the main operator in it will still be someone from the Ćurković family.

Mile Ćurković is known as an entrepreneur who extra stubbornly avoids public appearances, so nothing is known in advance about his intentions in business and life. However, when it comes to intentions regarding generational transition, Ćurković is no exception; entrepreneurs who usually do not shy away from journalists also generally do not want to talk about it. They should be understood. Preparing a successor in a family business is an extremely demanding and delicate task for each of them, often the hardest they have to accomplish in life, full of traps and unpredictable life circumstances. And even when there are smart children in the family who see themselves in the family business and are willing to educate themselves and work towards taking over the business from their parents one day, that does not guarantee that it will happen. Another reason why business owners do not want to publicly discuss their successors, which may be the most important, is the public secret that heirs of family businesses are targets for kidnappers, extortionists, and all sorts of criminals, from whom only complete anonymity can protect them.

Therefore, taking this reason into account, in analyzing how successors in the twenty largest Croatian family companies are preparing to take on responsible roles in managing the companies, we focused on information that is publicly available in various registers, or on successors who are already involved in the management or control structures of the companies.

Branko Roglić, the owner of Orbico, is one of those who are convinced that his company will remain in family ownership. His sons Stjepan and Josip have participated in the operational management of the company as directors for more than two decades, and then a few years ago, he pulled them into the Supervisory Board so that, as he said in an interview, ‘they would continue the approach to business that I had. I hope they will not stray from my successful path.’ Operational management of Orbico is entirely in the hands of professional managers.

Tomislav Mamić, the owner of Tommy, shares a similar view; like Roglić, he has entrusted the management of the company to professional managers, while his son Zoran, a graduate economist, has been placed in the Supervisory Board of the company and as Chairman of the Supervisory Board of Bobis, which is owned by Tommy. However, so that his son does not gain experience only as a supervisor, he is also a member of the management in several project companies registered for construction and real estate sectors that are ownership-connected with the Mamić family.

The sole owner of M San, the largest distributor of IT equipment, Stipo Matić, has apparently determined that his daughter Snježana will not engage in operational business in the company but only in ownership management. Stipo Matić has entrusted operational management to professional managers since 2009, and he has withdrawn to the Supervisory Board. Snježana Matić has not held any significant operational position so far, as she is also in the Supervisory Board of her father’s company, as well as in the Supervisory Board of the related IT company King ICT.

– Here, the idea of ‘passive ownership’ is now being flirted with. This is the idea that a non-family professional manager will manage the company, and the heirs will be ‘only’ owners. It is a long way to its realization, and it will certainly be increasingly present in the future, says Boris Vukić, a partner and one of the founders of Adizes Southeast Europe (ASEE).

The entire article can be read in the new printed and digital edition of Lider.

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