Title Family Business in Peru: Survival and Expansion under the ...

control over ownership and management of companies in this sub-group is not as strong
as that in other sub-groups. Professional paid managers with higher education and rich
experience are involved not only in day-to-day decision making but also in strategic
decision of the companies. Companies belong to JOINT sub-group are seen in
financial sector such as banking, insurance, pension funds, and large scale mining
projects, in which speed of technological innovation and management is very fast, and
companies are competing across boarders due to the liberalization of economy. Beer
industry, which is now facing regional integration, is also included in this sub-group.
It is indispensable for a family in order to obtain huge capital and highly educated and
experienced human resources.
4-2. Controlling Three Sub-groups
As mentioned above, companies that belong to family businesses in Peru can
be classified into three sub-groups according to their control over ownership and
management: EXCLUSIVE, MAJOR and JOINT. The families first started their
businesses with EXCLUSIVE companies. Then, with MAJOR companies, they
expand their scale and scope of the family businesses. In the process of the economic
liberalization after the 1990s in which higher competitiveness is required for survival,
family businesses sought their business partners abroad and incorporated JOINT
companies in order to obtain resources. In other words, the evolution of a joint stock
company and separation of ownership and management argued by Chandler did not
happen in many family business companies in Peru. The families, while keeping
exclusive control of ownership and management over their traditional businesses of
EXCLUSIVE companies in order to protect family assets, they combine different kinds
of companies such as MAJOR and JOINT depending on business environment in order
to expand socio economic influence of the family. In the case they face with adverse
business environment, they can sell MAJOR and JOINT companies while surviving
with EXCLUSIVE companies, such as in the case of Brescia, which sold Tejidos La
Unión at the beginning of the 1990s, and wait for another opportunity.
Among three sub-groups, JOINT companies, in which control is shared with
other families or foreign capitals, have played important roles in the history of family
business in Peru. Families that have some kind of connection, for example, securing
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