In this episode of our WIFB Conversations, Amy Katz and Ramia Marielle El Agamy explore the role of Money in the pursuit of a career and recognition in the family business.
This episode of Conversations with Women in Family Business is co-produced with Amy Katz, founder of coaching-business Daughters in Charge.
R: So Amy, we’ve decided to talk about money today. I think it’s a very interesting topic and I’m sure we’re going to get a lot of listeners based on this topic choice. So it’s a very good idea of yours, thank you very much. Amy, maybe you could share your experience as a coach or as someone who accompanies a lot of women through their careers and through their pursuit of finding balance in their lives. How do you assess the role that money plays in the lives of these women with ambition who are trying to have an impact on their family businesses and in their lives in general?
A: Well I can share what I hear a lot and that’s a sense that, particularly with women who have achieved a great deal in non-family settings. They return and they may have never expected to work the family business. But they are used to a more corporate work hard, get promoted, get a raise environment and then they find themselves back in the family business. Now they’re in a place where they may easily see inequity among the ways family members are compensated. I think about this in terms of a phrase from social psychology which is relative deprivation. What it means is we assess our status and what we are entitled to, whether it’s money or something else, in terms of relative to what other people are doing and earning. So we feel good or bad about our situation in comparison to others. When you think about that term in terms of a family business, the ‘relative’ side has extra meaning. So what do my relatives to earn compared to my contribution? And I think it becomes a particularly challenging issue for women when they see their brothers or their cousins who may be younger or may simply have a role of less responsibility earning the same amount. And I think sometimes the parents in the situation who have modeled this notion of, ‘You’ll be fine, I’ll be fine, let’s not spend her money right now on increasing your salary’, it gets very hard to make a case for oneself in the context of some of these situations. So that’s what I hear.
R: What are we, as women, most afraid of in bringing up the money situation? Are we afraid to offend? Let’s further generalize as we always do, Amy. When I see female family business members struggle with money questions, I think they feel they are generally very driven by passion. So it’s almost like their asking for more money is like contradicting the fact that they’re there for the long run and they’re there for the emotional, passionate reasons. To be fair, I’ve heard some older generations claim ‘You join the family business and basically it’s for the greater good, and you’re making these greater sacrifice for the family. And there’s buttons you can push very easily with women I feel. Maybe we more easily fall victim to feeling that responsibility, we feel responsible there. What is the most frequent reaction they fear if they come to the point where they actually have to ask for more money with in a family business?
I think in part, they fear they won’t be understood. That their very legitimate concerns will not be valued. I think they also have the added cultural norm that particularly with young women, should they decide to have children, that they’re being viewed as someone who will not be working full-time. So it’s almost as if they have to push harder in order to make their claim known. Now whether or not these women go part time or not, in some cases they do, but in the cases I’m most close to, they are hard charging while managing children at home. If they’re not working a 12 hour day, then they still can be questioned. So it’s not necessarily that they don’t feel they have a right, but they’re very mindful that it’s in the context of people viewing them as perhaps passionate but not necessarily going to make the choice to be working as hard and as long as they have in the past. So that’s one of the dilemmas. I think also the context of the family values is very important. In family cultures where there’s been a heavy emphasis on the employees and what employees receive in salary and benefits, it’s almost seen as something not to really ask for. Because they have so much compared to other people. So another limiting factor which may affect both men and women, can certainly be very realistic concerns about holding what’s important for the family. The family, after all, probably have the most history of working hard to create and sustain the family business.
R: Those are always the best case scenarios. The idea of being careful not to abuse your family status also comes from the fact that largely speaking, we encounter a lot of nepotism, a lot of high-level corruption infamily businesses. Which by the way, would also be an awesome topic to talk about someday, Amy. Corruption in the family business, I think that will go viral. But I think it’s really important to understand that as a family business member, I myself am very much aware of our paranoia to show to our non-family employees that we’re being fair. That we operate according to the philosophy, and I know a lot of our other family businesses I know was well operate according to the philosophy that we’re the first ones in the office and were the last ones to leave because we’re the owners. As operational owners, I think that’s also another one. The difference between being a shareholder and not being part of operations and then having that double role which is a huge contradiction sometimes of being a shareholder and having an operational role, usually high-up in the company. You’re in this constant struggle to prove that you’re there for a good reason. You are there based on competency and you’re willing to make at least as many, if not more, sacrifices than anyone else in the company. I think that’s also one of those things that play a role. I’m not sure if you’ve seen that as well from your end.
A: I have and that’s part of the issue. I think in some ways, I would call it in ambivalence about money. For those who have it, how they manage it, how they are able to ask for things for themselves, how they’re able to point out that very real business reality that they’ve dealt with for a long time. There is another side to it which I’ve become interested in as well, and I was thinking as you ask your question about inhibitions. I think there’s so much out there now about wealthy children becoming spoiled or entitled or insensitive. And so to some extent, I think women can think ‘I want a raise but I’m not entitled’. So there’s almost now this whole affluenza notion that, speaking of corruption, being raised in a wealthy family means you have the potential to be a certain kind of person. And so I think that can also be and inhibiting factor for women who want to say ‘I may have been raised as a wealthy child but that doesn’t mean I’m not entitled to be paid what I’m worth for the value that I contribute.
R: But you know, Amy it really brings us back to what you said in the beginning, it’s that comparison game. I really do believe money is probably the most fuelling factor that we have in life that fuels comparison. So my mom always used to quote Kierkegaard who is a Scandinavian philosopher, that whenever we would get bullied in school or experience the consequences of jealousy or something like that, my mom quoted that Kierkegaard used to say the root of all evil lives in comparison. And I remember it really sticking with me and if you apply that, it’s such a deep wisdom and it’s totally true. Over the last how many years ago she said that to me, I’ve been applying that saying around me and looking at the world through that lens. It’s astounding to me actually how often money is the basis for comparison. This person could afford this I can’t or the other way around. This person is worth this much because they have this much money. I feel a very strongly in the area where people are giving advice to others. When you see entrepreneurship, when we as women look to which women should we listen to, funnily enough, we as human beings always tend to turn towards the richest people, the most powerful people, for advice. For me I think there’s a real inherent danger there with money. I’m not going to refer to certain political instances happening in your country right now, I’m going to skip that because we would have to edit it out anyway. But I think it just goes to show that having and making money does not equate to competence or long-term success overall. I actually think that I’m often still a little disappointed in seeing women fall into that same trap over and over again. I feel like as women, between women especially, we have this huge potential in seeing many different other factors that we can use those benchmarks in order to become better. In order to have better lives and everything. But it’s a real issue, money in the family business, there’s no denying it. I asked for a raise once in my life and I really don’t want to go through that experience again and it was in my family business and it was not fun.
A: I think that’s the case anywhere but one of the things that I think can help is, as you know so well, because I’ve seen it in the content that you’ve been putting out. Entrepreneurship and finding a way to create what’s yours as a part of the larger family business can be one way that women can comfortably and confidently say this is my piece of the business. It was my idea, I developed it, I’m selling it it’s working. I think a lot of women in the family businesses can become entrepreneurs on their own but particularly when they create something with the context that can be part of the family business, it becomes a base from which they can more comfortably say, ‘Hey I’m contributing this and I’ve earned this’.
R: I feel what you’re talking about here is a very important thing in general which is metrics. For many family businesses, and this is this whole ambiguous discussion about the informality in a family business being an advantage. It is an advantage until it’s not. It’s an advantage because we make decisions faster, we are more spontaneous, a lot of stuff comes more from the heart and the gut feeling which is amazing and it’s fun. Until it’s not, until by not having certain metrics in place where we measure people’s impact, achievements go unrecognized. I think it’s important what you’re saying. I highly recommend this because after having spoken to the hundreds of family business over the years, it’s truly the one commonality you see across the board. Those that have given due and those who really deserve it are really the ones who thrive. And by the way, to those who are family members and those who are non-family members so just across the board, so just knowing who has an impact on the company and rewarding them. And money is a big factor in that but not just money. It’s also just showing that you’re being recognized for what you done for the company. That’s a huge, huge discussion we need to have in the family business field. How do we measure impact within the organization and how does that get rewarded? I think that’s a huge factor and it’s a difficult one because as a family member, tacitly I think you’re also just expected to show up. We like to have this whole discussion of how do women get to join the family business. To be honest with you, even just from other cultural backgrounds and I have come across in my setting, at the end of the day, whether you have an operational role in the business or not, you’re always expected to contribute. Whether you do it from home or from the sidelines or from within the company, that expectation is there. And as you said, when you’re actually in the family business in a professional setting that you start valuing yourself according to what you believe to be the case if this wasn’t your company. I think this is so important what you’re saying absolutely agree with you there.
A: I think also as small family businesses become family enterprises, as that business becomes ever more successful, then some of those issues become even more complex. So the siblings who may have argued about money, all of a sudden bond together against the cousins. I always think family businesses are an amazing organizational form. They do have to reckon with certain kinds of unique dilemmas that other business forms don’t. They can rely more on stricter policies or grade level increases or whatever. Whereas in the family, it’s a little more fraught for a lot of reasons.
R: Let’s face it Amy, if you’re looking for a good material for soap operas, you join a family business because that’s where it’s going down. That’s where all human emotions are getting mixed up in one place and is going to be shut downs every day. If you’re lucky, they’re entertaining and if you’re not, they’re seriously disturbing. I think this was a really wonderful discussion about money, a much lighter one then I expected. Fortunately, we didn’t go too deep into the philosophical discussion money should play in life. So very useful insights from you Amy, thank you very much and let’s begin next week on another topic.
About Amy Katz and Daughters in Charge:
Amy Katz is an executive coach and social psychologist whose business, Daughters in Charge, focuses exclusively on supporting women in family businesses. She is the author of Daughters in Charge: Learning to Lead in Your Family’s Business.