A founder’s death: What to do next?

By Prof. Enrique Soriano

 

As much as one might be prepared for the death of a dear friend or a close relative, we are never ready to receive such news. Over the weekend, I received a viber message from a family friend that read, “Hi Eric, just to inform you that Rod (not his real name) passed away due to COVID. It happened very fast. When he learned that he was exposed to a COVID positive staff member, he immediately took a swab test and the results turned out positive. He was then advised by his doctors to head straight to the hospital but after a day of confinement, his condition worsened and Rod passed away the following day. In five days, he was gone.”

That news was really heartbreaking but I was not surprised. Many of our relatives, friends, partners, clients and colleagues have passed on because of COVID. These deaths are really getting close to home and we are very lucky we are alive! But Rod’s death is somewhat different. He was a very good friend of 20 years. We shared many stories together from overcoming the Asian and global financial meltdown to navigating his way out of a severe debt crisis. In short, he always managed to come out of the hole bruised but unbroken.

Our friendship started when he invited me to be his strategic adviser for a couple of years. Eventually he also requested me to be a member of his Executive Committee. In our free time, Rod would ask me for advice on family governance. The last time we met was a few months before the pandemic when he excitedly called me if I can spare an hour over dinner so he can update me of his new initiatives. When we finally met, he introduced his son and showed me a map and typical of an old fashioned visionary, went ahead in explaining his plans even before ordering our food, “Prof, I know your schedule is full but I have two things to asked: help me realized my vision of a future master planned development and more importantly, mentor my son, he just graduated from university with honors.” Knowing Rod to be passionate about his plans, I told him when you’re ready, I will help you. He was happy with my response. I also promised him that I will find time to set up a team to make his vision a reality.

Months ahead and at the height of the pandemic, we would exchange calls and text messages without fail. But these last few weeks, I sensed something. Rod was no longer reacting or responding to my short messages. As I write this article, I still can’t believe Rod is gone. He was a maverick entrepreneur who embodied the values of never giving up and putting others first. His entrepreneurial spirit will live on in the company he built, the numerous worthy causes he quietly and generously supported and the lives he touched. Rod’s creativity, grit and habit of taking bold risks, noting that he “gladly shared the results” to close friends whenever they paid off. Rod’s death though was sudden and my sympathies to the family as I know they are overwhelmed, unprepared and grieving in this uncertain time.

My biggest fear is what will happen to Rod’s business? Did he prepare a transition plan? Are arrangements in place to cover this eventuality and does every member of the family  know about these plans? What effect will the death have on the business? Without a semblance of a succession plan,  Rod’s widow, children, employees and the business itself will be in for a hard landing. It is not only scary but too daunting to think of a likely scenario where the business owner dies without planning the future of the enterprise. The death of a key family figure is too much to bear for family members who are caught unprepared.

To be continued…