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New Delhi, Apr. 9 (ANI): “Inheritance can never surpass competence”, was the common sentiment expressed by leaders of corporate India participating in a Session on ‘Transition in India Inc: The Imperatives of Succession Planning’ at the CII National Conference and Annual Session 2011 at Delhi today.

Speaking at the session, Adi Godrej, Chairman, Godrej Industries further explained that the criteria for entry of family members into business should be pre-set. competence to handle the top job includes entrepreneurship qualities, ability to manage risks and leadership abilities.

Refuting the charge that transition of the mantle to family members is destined, Rahul Bajaj, Past President, CII and Chairman, Bajaj Auto said that in addition to competence, the qualities that work in favour of family members are deeper engagement with the family business, commitment, continuity and drive. “He doesn’t only look at quarterly results”, said Bajaj.

Subodh Bhargava, Past President, CII and Chairman, Tata Communications Limited and Wartsila India Limited suggested that age should be the criteria for retirement only in case of family businesses as one generation must give space to the next generation to prove itself.

The panel was gently nudged by moderator Ms Shereen Bhan, Executive Editor, CNBC TV 18 to disclose if they have ever faced the dilemma of favouring family members over a professional for the top job. Do Boards of family driven businesses decide on succession independently? Is it harder for a family business to have a succession plan in place?

These were some of the issues that were raised at the session. Godrej stressed on the importance of family boards and family councils for planning succession and resolving disputes, if any. He also highlighted that external assessment of family members is important before they are elevated to the top position. The panel further agreed that a two pronged strategy for succession planning should be adopted - one for retirement and the other for immediate replacement on account of demise or health related problems and these should be periodically reviewed.

Top corporate leaders also concurred on the importance of succession planning for owners as well as managers, though the same should be announced only when required.

The session wound up by acknowledging that in a country where at least 90% of businesses are family run, family businesses are a tribute to the entrepreneurial abilities of the country’s citizens. (ANI)