Economy
The Growth and Growth of Family-Owned Businesses: the Two Key Pillars of Success
By Kyra Motley and Chelsea Turner
Africa has seen an exponential growth of family-owned businesses (FOBs) in recent years, aligned with a fast-growing ultra-high-net-worth population – a trend that is set to continue on an upward trajectory.
This is particularly true of Nigeria. Nigeria has the largest population in Africa and is a landscape where family businesses are prominent and contribute significantly to the country’s economy. Here, FOBs contribute over $200 billion to the Nigerian economy and one out of two Nigerian businesses is a family business.
FOBs are typically resilient, exemplified by their resistance to recent inflationary pressures experienced in the Nigerian economy. Having experienced a number of challenges as they become established, family businesses are now ripe for growth, pending the stabilisation of the economic climate in the region.
Nigeria is one of the recently coined “Big 5” wealth markets in Africa, which together hold over 90% of the continent’s billionaires, and Africa’s population of high-net-worth individuals is predicted to rise by 42% in the next decade.
Therefore, at a countrywide level, the importance of these businesses to the economy cannot be underestimated, nor their wider contributions to the success of surrounding communities at a local level.
Good governance: a critical pillar for sustainable success
Given family businesses are a staple to the economy, it is therefore cause for concern that only 58% have a form of governance structure, and only 6% have dispute resolution procedures in place. Furthermore, in 2021, only 25% had succession plans and 9% had a family constitution, figures which are unlikely to have shifted notably in this time.
Family businesses must equip themselves with a governance framework to enable the business to progress further. A family constitution can ensure a clear goal for the family business and protect continuity for the business that spans beyond some of the family members themselves. This pre-emptive planning can provide beneficial opportunities for family members to settle into their roles before the practical elements of their positions are required. Another useful tool is shareholder agreements, which can ensure clarity on how the success of the business is maintained, providing peace of mind for families who may be concerned about the challenges to come and changes to follow.
Implementing a forward-thinking governance framework will benefit younger generations, who may themselves progress and lead the business forward. These generations may require specific skills or qualifications to enable them to lead with confidence.
These considerations are inherently important given it is an unfortunate fact that many of these family businesses, which are so important to Africa’s economy, do not manage to survive beyond the third generation.
Securing success through effective succession
The importance of effective succession planning should not be underestimated in combatting the challenges family businesses will undoubtedly encounter, and ensuring there is continued prosperity and success for these businesses and the region as a whole.
The challenges faced by family businesses are not inherently distinct from the challenges non-family businesses face. Family businesses do not hold a unique immunity to the challenges of economic instability, inflation, corruption, and terrorism that exist. These features are also not distinct to Nigeria and are faced by many other businesses globally.
However, in conjunction with these adverse influences, family businesses have a multitude of other considerations. Family businesses, just like every other family, will have disputes between family members. However, these disputes are susceptible to being strained, and complications can arise from contrasting management perspectives, concerns for the business, and dealing with business demands.
Furthermore, families are not fixed, instead altering substantially with time, growing with new generations, and coping with the loss of older generations. Legacy is an important aspect to consider, to withstand the changes and fluctuations of modern times, but most importantly so businesses can thrive through these changes.
The prospect of succession planning can be an aspect that family businesses avoid, yet this can cause significant instability – planning ahead can eradicate some of these fears and threats. Focusing too heavily on the present, without a lens for future generations, can result in these hard efforts being unrealised in the future.
In the unfortunate event someone in the family business becomes unable to continue running the business, there should be a plan in place that clearly sets out the steps that should be taken – these may involve drafting Wills for family members, or potentially establishing a trust structure to ensure shareholdings are passed efficiently.
These considerations are often postponed, yet incapacity and death can, unfortunately, strike suddenly and preparing for moments such as these hold the key to the business’s success and survival.
Ultimately, family businesses have a critical role to play in the Nigerian economy and with the right approaches and frameworks in place, they have the potential to propel their established success forward for generations to come.
Kyra Motley is a Partner at Boodle Hatfield, and Chelsea Turner is a Trainee Solicitor at Boodle Hatfield
Chelsea Turner
By Dipo Olowookere
The upward trajectory seen at the Nigerian Exchange (NGX) Limited in the past sessions was halted on Thursday as a result of profit-taking in Aradel Holdings, MTN Nigeria, GTCO, and others.
Nigerian stocks were down by 0.43 per cent because of the selling pressure. It was the first loss in 2026 and also the first in 23 trading session. The last time Customs Street ended in red was December 10, 2025.
The decision of investors to trim their exposure to equities contracted the All-Share Index (ASI) by 714.66 points during the session to 166,057.29 points from 166,771.95 points and brought down the market capitalisation by N458 billion to N106.323 trillion from N106.781 trillion.
A look at the sectorial performance indicated that the energy, commodity, and insurance indices were down by 2.21 per cent, 1.14 per cent, and 0.24 per cent, respectively, while the banking, consumer goods, and industrial goods sectors were up by 0.78 per cent, 0.33 per cent, and 0.01 per cent apiece.
Yesterday, investor sentiment was weak after the bourse ended with 26 price gainers and 41 price losers, showing a negative market breadth index.
McNichols declined by 9.99 per cent to trade at N6.58, Caverton crashed by 9.47 per cent to N7.65, Ikeja Hotel collapsed by 9.43 per cent to N35.05, FTN Cocoa dropped 9.38 per cent to sell for N7.05, and Neimeth went down by 8.91 per cent to N9.20.
On the flip side, Nestle Nigeria gained 10.00 per cent to quote at N2,153.80, NCR Nigeria appreciated by 9.97 per cent to N116.90, Jaiz Bank improved by 9.92 per cent to N8.20, Morison Industries rose by 9.90 per cent to N5.66, and Mecure Industries grew by 9.84 per cent to N97.70.
During the session, market participants traded 1.0 billion stocks worth N31.6 billion in 51,227 deals compared with the 761.9 million stocks valued at N29.9 billion transacted in 55,751 deals at midweek, representing a drop in the number of deals by 8.12 per cent, and a surge in the trading volume and value by 31.25 per cent, and 5.69 per cent, respectively.
Sovereign Trust Insurance returned on top of the activity chart with 245.2 million units sold for N798.5 million, Access Holdings traded 78.4 million units worth N1.8 billion, Zenith Bank transacted 72.4 million units for N5.0 billion, Jaiz Bank exchanged 53.7 million units valued at N433.9 million, and Lasaco Assurance traded 53.4 million units worth N135.1 million.
By Adedapo Adesanya
Crude oil was down by around 4 per cent on Thursday after the United States President, Mr Donald Trump, said the crackdown on protesters in Iran was easing, calming concerns over potential military action against the Middle-East country and oil supply disruptions.
Brent crude futures depreciated by $2.76 or 4.15 per cent to $63.76 a barrel and the US West Texas Intermediate (WTI) crude futures fell by $2.83 or 4.56 per cent, to $59.19 a barrel.
President Trump said he had been told that killings during Iran’s crackdown on protests were easing and he believed there was no current plan for large-scale executions, though he warned that the US was still weighing military action against the oil producer, which is a member of the Organisation of the Petroleum Countries (OPEC).
Thousands of people are reported to have been killed in the weeks-long protests, and the American president has vowed to support demonstrators, saying help was “on its way.”
Iran has threatened the US with reprisals were it to be attacked, alongside conciliatory signals, including the suspension of a protester’s execution.
The New York Times reported that many of the US Gulf allies, including several of Iran’s own rivals, have also pushed against a US military intervention, warning that the ripple effects would undermine regional security and damage their reputations as havens for foreign capital.
Regardless, the US withdrew some personnel from military bases in the Middle East, after a senior Iranian official said Iran had told neighbours it would hit American bases if America strikes.
Venezuela has begun reversing oil production cuts made under a US embargo, with crude exports also resuming. The OPEC member’s oil exports fell close to zero in the weeks after the US imposed a blockade on oil shipments in December, with only Chevron exporting crude from its joint ventures with PDVSA under US license.
The embargo left millions of barrels stuck in onshore tanks and vessels. As storage filled, PDVSA was forced to shut wells and order oil production cuts at joint ventures in the country.
With this development, the Venezuelan state oil company is now instructing the joint ventures to resume output from well clusters that were shut.
On the demand side, OPEC said on Wednesday that 2027 oil demand was likely to rise at a similar pace to this year and published data indicating a near balance between supply and demand in 2026, contrasting with other forecasts of a glut.
By Adedapo Adesanya
Nigeria’s crude oil production slipped slightly to 1.422 million barrels per day in December 2025 from 1.436 million barrels per day in November, according to data from the Organisation of Petroleum Exporting Countries (OPEC).
OPEC in its Monthly Oil Market Report (MOMR), quoting primary sources, noted that the oil output was below the 1.5 million barrels per day quota for the nation.
The OPEC data indicate that Nigeria last met its production quota in July 2025, with output remaining below target from August through December.
Quarterly figures reveal a consistent decline across 2025; Q1: 1.468 million barrels per day, Q2: 1.481 million barrels per day, Q3: 1.444 million barrels per day, and 1.42 million barrels per day in Q4.
However, the cartel acknowledged that despite the gradual decrease in oil production, Nigeria’s non-oil sector grew in the second half of last year.
The organisation noted that “Nigeria’s economy showed resilience in 2H25, posting sound growth despite global challenges, as strength in the non-oil economy partly offset slower growth in the oil sector.”
According to the report, cooling inflation, a stronger Naira, lower refined fuel imports, and stronger remittance inflows are improving domestic and external conditions.
“A stronger naira, easing food prices due to the harvest, and a cooling in core inflation also point to gradually fading underlying pressures”, the report noted.
It forecast inflation to decelerate further on the back of past monetary tightening, currency strength, and seasonal harvest effects, though it noted that monetary policy remains restrictive.
“Seasonally adjusted real GDP growth at market prices moderated to stand at 3.9%, y-o-y, in 3Q25, down from 4.2% in 2Q25. Nonetheless, this is still a healthy and robust growth level, supported by strengthening non-oil activity, with growth in that segment rising by 0.3 percentage points to 3.9%, y-o-y. Inflation continued to decelerate in November, with headline CPI falling for an eighth straight month to 14.5%, y-o-y, following 16.1%, y-o-y, in October”.
OPEC, however, stated that while preserving recent disinflation gains is important, the persistently high policy rate – implying real interest rates of around 12% – risks weighing on aggregate demand in the near term.
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