Tag: family business



Family members who are CEOs of their family business remain in the role longer and are rarely forced out. That’s one finding in a newly released research brief from the Koch Center for Family Business, “Family CEOs, Turnover, and Firm Performance.”

The brief was co-written by Koch Center Director Barton H. Hamilton, Professor Andres Hincapie (UNC), and research fellows Simone Hanna and Noah Lyman.

The brief details the following findings regarding the turnover and performance of CEOs in family businesses:

  • CEO performance has a signicant impact on the likelihood of forced turnover.
  • Family CEO successors remain CEO for longer and are almost never forced out.
  • Insiders (both family and non-family) tend to be appointed in more profitable companies than outsiders. Insider CEOs appear to outperform outsiders as a result.
  • Family insiders are younger and have more experience in the firm at time of appointment than unrelated insiders.
  • Founders are more likely to be forcibly removed from office by year two than any other CEO type.

Find more research and resources on family business and succession at the Koch Center site.




Olin Blog post by Spencer Burke, Koch Center Eugene F. Williams Jr. Executive in Residence. See more of his reviews and articles on his page at the St. Louis Trust.

Samsung Rising is the remarkable story of how a family-owned vegetable and dried fish shop established in 1938 has grown to become one of the largest and most valuable technology companies in the world.

It is part of Samsung Group, a Korean chaebol (a family group of companies or “wealth clan”) and is best known for Samsung Electronics, which is a global leader in the smartphone market and semiconductor manufacturing. The group is controlled by five separate branches of the founder’s (B.C. Lee) family; the family is one of the wealthiest in the world with an estimated net worth of over $40 billion.

The group is made up today of over 60 independent companies, many of them publicly listed, which, in the aggregate, account for approximately 20% of the GDP of South Korea and employ over 310,000. The family control is achieved through an opaque web of cross-shareholdings and inter-marriages among the Lee family and other owners of the constituent companies.

The current (de facto) head of Samsung is its Vice Chairman Jay Y. Lee, the son of Lee Kun-hee (Lee II). Lee II became chairman of Samsung in 1987 when his father, B.C. Lee, died. He retains the title of chairman despite having been incapacitated and non-functioning since May 2014 when he had a heart attack and a stroke.

Samsung Rising is subtitled “The Inside Story of the South Korean Giant that Set Out to Beat Apple and Conquer Tech” and reads like a Hollywood movie script. The author, Geoffrey Cain, a journalist with The Economist and The Wall Street Journal, has spent much of his career reporting on Samsung. The book is a compilation, more or less in chronological order, of hundreds of interviews, many of them anonymous, with key Samsung employees, competitors and suppliers.

The ‘exploding phone’

This “unauthorized” biography is undoubtedly the tip of the iceberg when it comes to the intrigue, family in-fighting, corruption and government entanglements with and support of this important company. As you will learn from reading this book, Korea’s success as a nation is intimately tied to the success of Samsung and vice versa.

The starting point of the story is the recent spectacular failure of the Samsung Galaxy Note 7 smartphone (the “exploding phone”). The author then takes the reader back in time to explain how this modest family vegetable shop transitioned its business to become the global leader in inexpensive and second rate consumer products, such as microwave ovens and TV sets, then on to challenge Apple’s domination in the global smartphone market and Sony’s domination in consumer electronics and, from there, to become a leading supplier of advanced semiconductors to the tech industry.

To my surprise, Steve Jobs and Ellen DeGeneres each play a significant role in helping Samsung make these leaps, as do many U.S. based technology and marketing experts and advisors. Legions of patent lawyers also play their part in this story as Apple and Samsung have spent a fortune over the years battling in courts around the world over the ownership of the intellectual property that has made all their technology advances possible.

Samsung Rising is also a book about family business in Korea. The Lee family control of Samsung is in its third generation and faces many of the same challenges faced by many successful multi-generational family businesses.

There are disputes and jealousies among the different branches of the family over ownership and wealth, there are on-going leadership succession issues at the company and there is a massive estate tax liability lurking that may result in the Lee family’s loss of control of some or all of the Group. There is also the issue that the third-generation leader of the company, hand-picked by his father, may not be of the same caliber of his two predecessors.

This all sounds familiar, but there is a lot more to learn from the story because of the vast differences between the cultural and business environments in Korea and the US. Through the lens of the Samsung success story, it is fascinating to see how these differences are playing out in real time. So far, the Lee family and Samsung have benefited tremendously from them.

However, darker clouds are on the horizon. The most prominent differences include:

Business purpose

B.C. was a patriot and had immense pride in his home country. While working in Japan before WWII, he was a skilled observer of the Japanese economy and the companies that made Japan so successful. He dreamed of doing the same for his homeland and that is what he set out to do when he returned home in the late 1930s. B.C. Lee’s perspective on this is best illustrated by this quotation from a plaque in the miniature shrine that marks the company’s first place of business:

“I think people are most happy when they know what gives their life purpose. I am unshakeable in my faith that strengthening the nation through business is the path I must walk” (p. 32)

The motto on the Lee family crest also emphasized this: “First, serving the nation through business. Second, people and talent come first. Third, the pursuit of the reasonable.” (p. 41)

The shared identity of Samsung’s success with that of Korea has taken on an almost militaristic tone. The author notes:

“The odd similarities between the traditional culture of Samsung (and other South Korean companies) and the totalitarian dictatorship of North Korea are no coincidence. The Korea scholar B.R. Meyers has written about North and South Koreans’ belief in a shared, ancient bloodline that informs their politics and societies today. South Koreans, he argues have identified strongly with the Korean race that transcends a border with North Korea, a far stronger identification than with their democratic system of government.

“The result, he says, is that North Korea is the world’s most nationalistic country, while ‘the second most nationalistic country, in my view, is South Korea, which is completely open and completely wired, and still dominated by a very paranoid way of looking at the outside world’.” (p. 65)

The book makes many references to the “cult-like” environment and behavior at Samsung. Other successful companies have this as well, but this one is particularly focused on the company’s identity with the success of South Korea as a nation. This clearly has been a major contributor to Samsung’s success.

Chaebol business structure

B.C. was also a big fan of the success of leading Japanese companies, such as Sony, Toyota and Honda. These companies are called keiretsu and, unlike the traditional Japanese zaibatsu structure, are not always run by families but by “shareholding collectives, centered around a private bank, marking a break in Japanese tradition.” (p. 36) The keiretsu form of organizational structure arose in Japan because the U.S. military banned the formation of holding companies after WW II in an effort to reduce the economic power of the zaibatsu families. The author goes on to explain:

“South Korea followed with its own ban on holding companies. But its business leaders were determined to keep the zaibatsu practice of top-down family rule. So they embraced the cross-shareholding practices similar to Japan’s newer keiretsu companies, and found loopholes to pass those cross-shareholdings to their children, through charitable donations and mergers within their business empires.” (p. 36)

The Korean form of the keiretsu is the chaebol and here is what the author had to say about it:

“Pointing to the similarities between Samsung and other companies doesn’t dismiss the common culture and heritage between North and South Korea and, to some extent, Japan and China. The fact is that the South Korean chaebol have little in common with the more entrepreneurial and shareholder-driven firms in the United States.

“Even the biggest companies in the United States do not enjoy the privileges of companies in South Korea today. More than half of the family leaders of the ten biggest chaebol groups are convicted criminals. All have been pardoned by the president, often without serving prison time. Three of them, including Samsung chairman Lee II, have been pardoned twice.

From January 2015 to February 2016, the outside members of Samsung Electronics’ board of directors—who were supposed to be independent, as a check on corporate governance—unanimously approved every proposal put forward by the company, except the two times a director was absent.

“Imagine the heirs of the Carnegies and Rockefellers being so powerful and revered that The New York Times would self-censor its coverage out of deference. Imagine a White House pardoning the heirs of Sam Walton or Ray Kroc, as they ran the operations of Walmart or McDonald’s from their prison cells. Or seasoned journalists turning their eyes away when confronted with Donald Trump’s conflicts of interest between his presidential duties and his businesses.

“Because of the outsized privileges of Samsung and the Lee family, South Koreans tell me that Samsung has grown too big to fail”. (p.71-72)

Collective Harmony family culture

The dominant cultural style in East Asia is referred to as the Collective Harmony culture and the Lee family is a great example of it. Here are a few useful descriptions of its primary characteristics:

“[This culture is] premised on Confucian principles elevating loyalty and obligation to family, respect for parents and other authorities, knowing one’s place, and supporting the whole group rather than one’s individual position…..

“The concept of ‘face’ is central to Collective Harmony culture….The term has no exact counterpart in Western language. It contains elements of prestige, honor, respect, reputation and influence. However, it is much more socially-derived and -connected…

“In Collective Harmony, the web of social relationships is much more influential in maintaining individuals’ esteem. This is important because direct assertive communication may tear all too easily at the bonds between individuals and their social network if not handled carefully, especially in families.” Jaffe and Grubman, Cross Cultures (2016) (p. 37-38)

By contrast, US and other western countries typically are guided by an individualistic family culture. There, the purpose of larger organizations, such as family and businesses, is to support the independence and self-worth of each individual.

Cain emphasizes the important role of this family culture at various points in the story. He quotes a noted historian on Korea who said, “It’s a very basic Korean trait that trust rarely extends beyond one’s family, and that includes the Samsung family”. He goes on to say that Samsung’s and Korea’s common heritage evidences itself in five traditions:

“The extreme reverence for family dynasties; the belief that their strength is derived from an ethnic bloodline; the promulgation of military-like rituals, ceremonies, and slogans; nationalistic paranoia and distrust of outsiders; and the veneration of a supposedly wise, paternalistic emperor-like leader.” (p. 67)

This culture has served Samsung well through its first two generation of leadership. As it moves fully into the third generation and must compete with the largest and best run tech companies in the world, one must wonder if it will continue to do so. Command and control management and dynastic succession are not likely recipes for success in this competitive world.

Estate taxation/regulatory environment

It was fascinating to learn from this book about the rejection of the zaibutsu and holding company corporate structure in South Korea as a means to grow the economy after the devastation of the Korean War. Another key feature of the post war regulatory regime in Korea was the imposition of a 50% inheritance tax on the inter-generational transfer of wealth; in the case of an inheritance of a “controlling stake” in a company, the tax rate rises to 65%. As in the U.S., there is a correlative gift tax regime with the same tax rates for life-time asset transfers.

The chaebol corporate structure and this inheritance tax regime turn out to be a very toxic combination. Most of the ownership stakes in the chaebol are minority positions—it is the aggregation of these ownership stakes which give families the ability to “control” the entities but not necessarily the ability to monetize those stakes or use company assets to pay their taxes.

Family leaders need to transfer assets downstream very early in their careers when asset values are low to minimize the inheritance tax, but this endangers their ability to “indirectly” control the corporate entities in the group. If they wait too long and asset values have risen dramatically, as is the case with most of the chaebols, the tax obligations at death likely will force the sale of a substantial part of the ownership in the group and may lead to a loss of control. This is exactly the predicament that the Lee’s find themselves in today and it has caused no end of controversy.

The taxable estate of Lee II is estimated to be about $17 billion, meaning that a tax bill of roughly $8.5 billion in taxes will be due at his death, which could be at any time now. This is a problem shared by many of the large family-controlled companies in Korea. A recent Financial Times article estimates that the aggregate estate taxes owing by the largest 25 Korean companies now exceeds $21 billion. That liability grows daily.

Efforts by families to minimize the impact of this tax have ensnared many chaebol leaders and Jay Lee is prominent among them. In fact, Jay Lee is currently being dogged by prosecutors who have alleged that he engaged in a fraudulent merger transaction among two Samsung affiliates for the purpose of shoring up his ownership stake in Samsung Electronics so the Lee family would have a funding source to pay the inheritance tax. Approval of this merger also led the Lee’s to manipulate the accounting records of yet another company in the Samsung Group to inflate the stated value of the acquiring company in the proposed merger transaction.

Coincident with all this, Jay Lee made a $38 million dollar “contribution” to a close friend of the former Korean President so she could finance her family’s efforts to compete in the equestrian events at the up-coming Summer Olympic Games. Prosecutors have alleged that this payment was in fact a bribe for approval of the merger transaction. If convicted of any of these charges, Samsung’s Chairman in waiting will be waiting in prison for a long, long time.

Jay Lee may have gotten away with all this but for the watchful eye of Paul Elliott Singer, the founder of US-based hedge fund Elliott Management. Singer, described by some as “The World’s Most Feared Investor,” owned a minority stake in the company that the Lee family was attempting to swallow-up in the merger for a price far below its fair market value. 

Singer sued to block the proposed merger but his claim was denied; a civil fraud suit is still pending. Despite obvious breaches of fiduciary duty and fraud, the transaction garnered close to 70% shareholder approval, including approval by the National Pension Fund of Korea that lost millions of dollars for pensioners on the transaction.

Behavior like this gets much greater scrutiny in the US and is a cautionary tale for those investing in the equity of non-US companies subject to different legal systems and cultural norms. The legal standards of fiduciary duty, anti-trust and corporate law are often very different there.

The story of the Lee family’s desperate efforts to address its looming estate tax liability is a highlight of the book. This story had gotten very little public attention outside of Korea considering the size and importance of the Samsung Group and the prominence of the Lee family. It also lays bare the difficult challenges faced by chaebol owners to remain in control of their companies in the future. Add to this a growing clamor in Korean politics over income inequality and the need to rein in the power (and wealth) of the chaebols. Clearly, the family owners have many challenges ahead.

Samsung Rising is well worth a read for those interested in the global technology market and Korea’s (aka Samsung’s) remarkable rise to prominence in recent years. It is especially interesting right at this time, since Samsung Electronics has become a key ally of the U.S. in its attempt to slow down the domination of Huawei in the 5G market.

For those interested in family business, this is a must read. It is an exciting growth story and highlights the prominent role of purpose, family culture and government regulation and support to Samsung’s success.




Spencer Burke

Emma Vogel, a video intern in Olin marketing and communications, wrote this for the Olin Blog.

Spencer Burke, adjunct lecturer in family business for WashU Olin, will assume the role as Eugene F. Williams Jr. Executive in Residence for the Koch Center for Family Business, Dean Mark Taylor and Professor Bart Hamilton announced in May.

The appointment is the latest development following the spring 2018 announcement of the Koch Center for Family Business, launched with the support of the St. Louis Koch family’s gift $9 million. That center is the outgrowth of the Olin family business program, funded with a $1.09 million donation from the Kochs in 2016.

The Olin family business initiative began to “educate future business leaders on unique family business issues while providing resources for family enterprise as they grapple with these challenges.”

Prior to accepting this position, Burke served as the leader of the family business initiative and has been the organizer and moderator of Olin’s highly successful annual family business symposium. He is a principal at the St. Louis Trust Company, where he leads the firm’s family business advisory practice.

Additionally, Burke currently serves as chairman of the board of the Mallinckrodt Foundation, which seeks to fund biomedical research in St. Louis and throughout the United States.

“I have taught at Olin for eight or nine years and I am excited to no longer be the lone ranger in family business,” Burke said. He will now join a team at the Koch center—led by Hamilton, the center’s inaugural director, Olin’s Robert Brookings Smith Distinguished Professor of Economics, Management & Entrepreneurship—that will help to tackle family business education.

Burke also feels that that through the establishment of the Koch center and the family business initiative, the subject matter is being recognized as an important part of Olin Business School. While in the position, he wants to be a part of the team that animates the important role of family business in the U.S. economy.

Much like the mission of the Olin family business initiative, Burke places importance on business sustainability. Along with the other key players in the family business center, Burke will be the resident practitioner of family business issues.

As the executive in residence, he will be available for consultation at the request of students and will also be establishing office hours for the upcoming semester. He is excited for the opportunity to have more interaction with students in the family business program. This will allow for valuable, real-time analysis and problem solving in relation to real-life family business issues that students encounter. Burke feels that through more interaction, the program will achieve even greater success.




By Carlos Restrepo, originally published in the 2018 edition of Olin Business magazine.

Spencer Burke

Spencer Burke

Before launching Washington University’s first family business course, Olin Business School’s Spencer Burke felt confident in his knowledge of the topic. After all, Burke, principal at the St. Louis Trust Company, had worked as a corporate lawyer for 15 years and an investment banker for 25 years.

“It wasn’t until the course started that I came to understand just how difficult some of the issues are,” said Burke, an adjunct lecturer at Olin. “The challenge arises from the inherent complexity of doing two difficult things—often in conflict—simultaneously: One, having family harmony. And the second is running a successful business. Those are two very challenging tasks, especially when put together.”

In the five years since starting the course, Burke has taught students the complexities of family-owned business, an area of study he believes is necessary for students seeking any business career.

In fact, the need is great enough that Olin is well on the way to establishing a full-fledged research center on the topic. The Koch Center for Family Business is in the planning stages thanks to a donation of more than $9 million from Roger, Fran, Paul, and Elke Koch. Paul, BSBA ’61, JD ’64, MBA ’68, and Roger, BSBA ’64, MBA ’66, are co-chairmen of the board, and the third generation in leadership at Koch Development Co., a St. Louis-based developer and manager of commercial real estate and owner/operator of select entertainment attractions.

The Koch’s donation will also endow an Olin professorship and Dean Mark P. Taylor is seeking a candidate for the position, a faculty director for the new family business center. The center is the next phase of a family business program begun under former Dean Mahendra Gupta in 2016 with an initial $1.09 million gift from the Kochs.

“There are really three heroes in this,” Paul Koch said. “Mahendra, who comes from a family business in India and saw the need; Spencer Burke, who kept the fire burning; and Dean Taylor, who is an internationally experienced business leader and he picked up that this is a huge issue all over the world.”

The Koch Center for Family Business will not be a brick-and-mortar space, but rather a program within Olin aimed at developing research and disseminating knowledge into the dynamics of family businesses.

“This is not about creating some building or monolithic thing,” Burke said. “This is about addressing the unique issues that family businesses have and giving people interested in that an opportunity to learn more.”

Student-Led Initiative

When John Stupp III began his Olin MBA in 2013, the school had no family business program, prompting him and fellow students to inquire with Gupta about developing a curriculum around the topic. He commissioned five students to analyze the feasibility of a formalized family business program.

From both a practical and theoretical standpoint, there are a significant number of differences among business approaches between family and non-family enterprises, Stupp said. They include issues of succession planning and estate taxes, as well as separating personal and business related-matters.

“The team felt the differences between family and non-family enterprises were drastic enough that it demonstrated a need,” Stupp said. He and his colleagues saw their vision grow further when Burke agreed to teach the family business course and begin to launch Family Business Program.

That program includes a half-semester course, a student-run club, and an annual symposium and speaker series. “These different avenues allow students to experience a diversity of theoretical and practice thought and gain insights into family business best practices,” Stupp said.

Stupp said his interest in family enterprises came about in part from his family’s 162-year-old business, Stupp Bros. Inc., which provides infrastructure development and banking services across the United States. While at Olin, Stupp said he wanted to prepare to continue his family’s tradition of success by learning more deeply about succession planning and how to effectively manage a business while separating family and professional matters. He now serves as director of project management for the company.

“Students get totally focused on big, publicly traded companies. They get no exposure to what family businesses are like,” Roger Koch said. “Family businesses by far create more jobs than any other sector of the economy. There are great careers to be had in family businesses. They’re very long-term oriented. They don’t only think about the next quarter.”

Global Impact, Regionally Based

Dean Taylor said expanding the family business initiative into a full-fledged research center supports Olin’s strategic plan by leveraging the school’s world-class research to create and disseminate knowledge in an innovative way and preparing students for careers in enterprises with global reach.

“Family businesses are among the biggest job creators internationally, nationally, and regionally,” Taylor said.  “Therefore, we are thinking about how we can enhance our research and the body of knowledge in the area. We want to support and enhance family-run and closely held businesses.”

The existing course is not only popular with students who are planning to join or start their own family business, but it’s equally important to students planning to go into fields that work with family-owned businesses.

Such is the case of Jeff Wertenberger, MBA ‘18, an investment banking associate for financial services firm Robert W. Baird & Co. In his role, Wertenberger is occasionally confronted with situations that are specific to family-owned businesses. Taking the family business course and attending the symposiums helped him understand those situations more deeply.

Stupp and Wertenberger said all Olin students should be exposed to the dynamics of family businesses—even if they’re not family business practitioners. Even leaders who don’t work for family owned businesses are likely to work with them at some point in their career.

“It’s important to be knowledgeable of these unique dynamics, what motivates them and what’s important to them,” Wertenberger said. “That’s how important it is.”

Creating First-Hand Connections

In his curriculum, Burke brings real-life cases from around the world to illustrate the importance of understanding the nuances of family-owned businesses.

There are approximately 5.5 million family-owned businesses in the country, which Forbes magazine says contribute to more than 50 percent of gross domestic product and employ more than half of the nation’s workforce. As vital as they are to the nation’s economy, fewer than a third of all US family-owned businesses survive the transition from the first to the second generation of ownership. Another 50 percent don’t make it to a third generation.

“How can we—as students, as faculty, as a school—help the people in these businesses do a better job and how can we help the people who aren’t in the family businesses do a better job helping family businesses?” Burke said.

One component of the existing Family Business Program that will expand with the research center is the ability to study real cases and hear speakers from dozens of companies—including Todd Schnuck of Schnuck Markets, Sue McCollum of Major Brands, and Kyle Chapman of Barry-Wehmiller—at different generational stages and with a unique perspective to the craft.

The program also collaborates with the Olin Center for Experiential Learning, pairing students with family businesses on consulting projects to tackle different challenges unique to those firms, applying principles from the classroom to real-world problems.

Fran and Elke Koch, first row. Paul Koch, Dean Mark Taylor, Roger Koch, and Chancellor Mark Wrighton on February 20, 2018, when the Kochs' gift was announced.

Fran and Elke Koch, first row. Paul Koch,
Dean Mark Taylor, Roger Koch, and Chancellor Mark Wrighton
on February 20, 2018, when the Kochs’ gift was announced.

“A course on family business taught with a case book would not be great,” Burke said. “What’s fun about this is the real-life examples that illustrates the conflicts and how challenging the resolution is.”

Taylor said he anticipates the Koch Center for Family Business will contribute to bettering local and global economies by preparing students to assist these unique, yet essential enterprises.

“It is part of our duty as an institution,” Taylor said. “We seek to have high impact internationally, nationally and regional—and this is an opportune area.”

For the Kochs, they envision a thriving Family Business Center as a world-class resource supporting academic research, preparing students to confront these unique issues, and driving long-term success for family business owners.

“We have friends who spend tens of thousands going to Stanford or Harvard to learn about these burning issues—and we think St. Louis could be one of those centers,” Paul Koch said. “We can make a mark in this area that would make us unique.”

KEY ISSUES

The dynamics of family-owned businesses pose unique challenges for business leaders. The challenges are substantial in a segment responsible for 80 percent of global job creation and 64 percent of the US economy.

  • Succession planning and growth. Distribution of assets can become an issue as the business spans generations.
  • Lack of transparency. Closely held firms hold information close to the vest, which constituents may view as being secretive.
  • Competing motives. Profit may not be the singular success driver for leaders in family-owned businesses. They can be more purposeful, but their purposes may vary.
  • Lines of authority. The person truly calling the shots may not have the title or the corner office, affecting how others effectively engage with a family business.

BY THE NUMBERS

Some key metrics about family-owned businesses.

  • 82 percent of US survey respondents said they trusted family businesses versus 58 percent who trusted “businesses in general.” Globally, the numbers were 75 and 59 percent, respectively.
  • Half of respondents know which companies they buy from are family owned.
  • 81 percent of the world’s largest family businesses practice philanthropy.
  • 25 percent describe family businesses as “transparent” in their business operations.
  • 52 percent say they are “well-prepared” for a sudden succession.
  • Of the world’s 500 largest family businesses, nearly 28 percent are in North America.
  • One in five firms are family owned.

Sources: Edelman; EY Global Family Business Center of Excellence; Forbes.




It’s a cornerstone of the American dream: starting a business, growing it, then passing it down to new generations.  Now, Olin Business School at Washington University in St. Louis will have a new tool to help family business leaders learn how best to build and preserve their legacies into the future.

Mahendra R. Gupta, dean and the Geraldine J. and Robert L. Virgil Professor of Accounting and Management at Olin, announced a four-year, $1.09-million gift from Roger and Fran Koch and Paul and Elke Koch that will launch the Olin Family Business Program. The program will position Olin as a leader in the field as it helps prepare its students to enter and lead their family businesses. Gupta’s announcement came during a half-day Family Business Symposium held April 22 at Olin.

“Olin Business School has long been a leader in preparing our students to enter and lead their businesses,” Gupta said. “This generous gift from the Koch Family will allow us to build on the resources and courses Olin already has in place to further strengthen the skill set of these students, and also address specific needs of family businesses. We are indebted to the Kochs — Roger and Fran, and Paul and Elke — for funding this very important initiative.”

In addition to attracting the next generation of family business leaders and connecting them to programs and resources needed to succeed, the Olin Family Business Program will also include an internship program for students seeking careers with family businesses, and Family Business Practicums, in collaboration with Olin’s Center for Experiential Learning.

These projects will pair faculty-led student teams with family businesses who seek effective solutions for the unique challenges they face. At the end of the practicum, the teams will deliver a report to the client company outlining their recommendations.

With their gift, the Kochs are also establishing the Koch Family Business Scholarship Fund, which will offer financial support to attract candidates with connections to family business to Olin’s full-time MBA program.

About the Kochs

Paul A. Koch (BSBA ’61, JD ’64 and MBA ’68) and Roger L. Koch (BSBA ’64 and MBA ’66) are co-chairman of the board at Koch Development Co. They are third generation family business owners in the real estate investment and development business. Both Roger and Paul have been recognized as Distinguished Alumni of the Olin Business School, and have been advisers to, and generous benefactors of, the university for many years.

The program will launch in Fall 2016.

Image: (From left:) Mahendra Gupta; Christopher Hoffmann, MBA ’16, vice president of Olin Family Business Club; Roger Koch; Elke Koch; Paul Koch; Emmy Caton, MBA ’17, incoming club president; and Ryan Plotkin, MBA ’16, president. Not pictured: Fran Koch. (Photo: Whitney Curtis/Washington University)

News release originally published on WashU’s The Source, by Erika Ebsworth-Goold