Can a family transition a billion-dollar family business successfully? A great example is the Edmiston family, owners of IM Group, Birmingham, UK. I often explain to my ELO Counsel family business clients that successions can go well—but there are a number of principles that must be followed. Just as all businesses can run either well or poorly, the same is the case with family businesses.
Robert (Bob) Edmiston, Founder of IM Group, and his son and current Managing Director, Andrew Edmiston, addressed the cohort of the ELO Oxford Leadership Program at their headquarters in Birmingham, UK, on July 10th, 2024.
Who are the Edmiston family? Lord Robert Edmiston founded IM Group Ltd. The main businesses, which form part of the original IM Group, involve the importation and distribution of Japanese cars and parts in the UK. Other activities include importing various car marques into Ireland, Sweden, Finland, Denmark, and the Baltics. IM Group also has a Beijing office which, in addition to developing Group interests, operates as a consultancy to industry generally, acts as a trading house and as a procurement office on behalf of third-party clients.
In the early 1990s, expansion saw Lord Bob buying into a publicly quoted property company called BHH, which he subsequently turned private, and is now known as IM Properties PLC. IM Group is also the majority shareholder in a finance company called The Funding Corporation.
Lord Bob is the father of his grown-up family, including Andrew and two daughters, all of whom are married; he has several grandchildren and great-grandchildren. His two daughters are not active in the business.
Lord Bob and his wife Tracie founded a charitable trust called Christian Vision that operates in a variety of countries, primarily through media, the internet, and ‘in country’ projects to spread the Christian message. In the UK, they have sponsored schools called “Grace Academy” for students aged between 11 and 18 years old. They continue to be trustees of the Grace Foundation. Lord Bob has a keen interest in politics, business and social issues.
On January 18th, 2011, Lord Bob was introduced into the House of Lords where he spent the next four and a half years. He retired from the House of Lords in July 2015 to allow him more time to focus on his charitable activities through Christian Vision.
So what is the future of IM Group and Christian Vision and what are the lessons learned regarding a successful transition?
1. Getting outside specialized advice can be an asset.
Lord Bob and Andrew brought in an external family business consultant to help with the transition process. Regardless of how large and successful a company is, it can still be useful to get a third-party perspective and to work with someone who has travelled this path many times. Each family has only one chance to get it right.
2. A successor needs to be set up to do well.
Andrew, a qualified management accountant, has worked for IM Group since late 1992, having previously held positions outside the company in the wider motor industry. Since 1996, he held the position of Managing Director of IM Sverige (Sweden) and subsequently assumed the role of Managing Director of IM Truck, establishing a subsidiary in Zimbabwe and promoting other new business ventures. In 2000, International Motors took over Daihatsu UK and Andrew was appointed as managing director.
3. Having a long runway for a successor is helpful.
At the end of 2004, Andrew was promoted to managing director of IM Group when he commenced a two-year succession program in advance of assuming full control of the day-to-day activities of the Group towards the end of 2006. At the end of 2015, Lord Bob relinquished most of his day-to-day business responsibilities to Andrew. Lord Bob then semi-retired in Portugal in 2016 but remains a non-executive director of IM Group and continues his charity work through Christian Vision and Grace Foundation.
4. There needs to be an alignment of values and understanding as to the purpose of the business.
Andrew is supportive of IM Group’s charitable initiatives through Christian Vision (and he also has some of his own charities). IM Group’s success allows it to support many worthwhile endeavours. At the end of each year, Bob and Andrew review how to distribute funds to charity and how much to retain in the company.
5. There needs to be clear communication between the different generations within a family regarding succession plans.
This is easier said than done. Too many families reflect a lack of clear-cut instruction. In the case of Lord Bob, he is a very clear communicator and the meeting we had with both him and Andrew reflected a commonality of intention.
More about the Edmiston Family:
Lord Edmiston, UK: A One-of-a-Kind Entrepreneurial Leader
Andrew Edmiston, IM Group Ltd., Participates in ELO Oxford Leadership Program