Soriano: If you can’t avoid nepotism, set the rules of engagement

Nepotism has a long history in many countries in Asia, with examples found in different periods and contexts. Here is a brief overview of the historical context and notable instances of nepotism in Asia especially in China, Japan and India.

Emperors and ruling dynasties often appointed family members to positions of power and influence within the government and bureaucracy. This practice aimed to consolidate familial control and maintain loyalty within the ruling family.

In feudal Japan, nepotism was pervasive among the ruling samurai class. Powerful daimyo (feudal lords) would often appoint their family members, such as sons or close relatives, to key positions within their domains. This practice allowed them to maintain control and secure their family’s status and power.

In South Asia and before India’s independence, the Indian subcontinent consisted of numerous princely states ruled by local monarchs. In many of these states, nepotism was so common that local rulers would often appoint their relatives to positions of power and authority within the state administration.

Modern Asia also gave rise to nepotism in business environments, particularly in family-owned enterprises. Family members may be given preferential treatment and positions within the company, often based on their family ties rather than their qualifications or abilities.


Managing nepotism in a family business is essential to ensure fairness, maintain a healthy work environment, and maximize the business’s potential. So if you are in a dilemma and still insist that being blood is a birthright and translates to employment, then the next step is to make your children accountable.

Here are some strategies I would always advise founders and business leaders across Asia to effectively manage nepotism:

Develop and communicate transparent policies that outline criteria for hiring, promotion, and decision-making within the company. These policies should emphasize meritocracy, qualifications, and performance as the primary factors in making such decisions.

Implement objective quarterly performance evaluation systems that assess all employees, including family members, based on their performance and contribution to the business. Regular feedback and performance discussions can help identify areas for improvement and ensure accountability.

Offer equal opportunities for growth and development to all employees, irrespective of their familial relationship. Implement a system for career progression that is based on individual competence, skills, and achievements, rather than solely relying on family ties.

Promote the inclusion of non-family employees in decision-making processes and leadership roles. This can be achieved by providing them with meaningful responsibilities, fostering an open and inclusive work culture, and valuing their contributions.

Offer training and development programs to enhance the skills and competencies of all employees, including family members. This ensures that family members have the necessary qualifications and capabilities to fulfill their roles effectively.

Consider hiring external professionals or consultants for key positions, especially if they possess the required expertise and experience that family members may lack. External perspectives can bring fresh ideas, diversity, and valuable insights to the business.

Foster a culture of open communication, where employees feel comfortable expressing their concerns and ideas. Encourage feedback from both family and non-family employees and address any issues related to nepotism promptly and transparently.

Develop a succession plan that prioritizes competence and leadership qualities when identifying future leaders of the business. This ensures that family members are evaluated objectively and that the most qualified individuals are chosen to lead.

Family members in leadership positions must lead by example, demonstrating professionalism, competence, and a commitment to the success of the business. This can help build trust and respect among employees, both family and non-family.

By implementing these strategies, a family business can effectively manage nepotism, promote fairness, and maximize potential for success.