Poor institutional structure responsible for family businesses failure in first generation — Experts

Industry leaders have identified weak institutional structures and poorly planned succession as the primary reasons most family businesses in Nigeria collapse after the founding generation.

This consensus was reached at the 2026 International Family Business Conference, held at the Ecobank Pan-African Centre in Victoria Island.

The summit, themed “Beyond Survival: Governance & Culture as the Foundation of Lasting Family Legacy,” was hosted by the Lagos Business School (LBS) Family Business Initiative.

Professor Uchenna Uzo, Deputy Vice-Chancellor at Pan-Atlantic University, revealed that while family businesses contribute nearly 50% of Nigeria’s GDP, a staggering 70% fail to transition successfully to the next generation.

He warned that the greatest risk to these enterprises is succeeding without planning for the future.

The Dean of Lagos Business School, Professor Olayinka David-West, reinforced this, stating that in the current economic climate, endurance is the new benchmark.

She urged owners to move beyond governance on paper to making it a daily discipline.

Presenting findings from the Longevity Blueprin study, Dr. Okey Nwuke, Director of the LBS Family Business Initiative, noted that only 28% of the 365 surveyed businesses operate with formal succession frameworks.

He warned that as many founders enter their 50s, the lack of codified governance rather than market competition remains the greatest threat to their continuity.

In his keynote address, the Chairman of Channels Media Group, Mr. John Momoh, shared his experience in institutionalizing his media empire.

“If the founder is the system, the system will fail,” Momoh asserted.

He argued that legacy should be measured by the systems established to manage wealth, rather than the wealth itself, citing the Rockefeller family as a global benchmark.

The conference concluded with a fireside chat featuring Mr. Rasheed Sarumi, Group CEO of Saroafrica Group, who emphasized that formal governance eliminates ambiguity, ensuring that future disputes are resolved through logic and structured processes rather than emotion.