Questioning the Answers
By Faraz Shauketaly
Family businesses like to tell a particular story about themselves. It is a story of continuity, stewardship, and values passed down rather than written off. In both the UK and Sri Lanka, that story has long carried emotional weight—sometimes more than balance sheets ever did.
But stories age. Families fragment. And markets, unlike founders, have no nostalgia.
The unfolding debate within Russell & Bromley—a 145-year-old British footwear house now divided over whether to sell its legacy or preserve it—has an uncanny resonance for Sri Lanka, where family-owned enterprises dominate the corporate imagination, if not always the corporate future.
The parallels are instructive.
In the UK, Russell & Bromley represents an old model: patient capital, conservative growth, and a belief that continuity itself had value. For decades, the Bromley family acted less like owners and more like custodians. The brand survived wars, recessions, and retail revolutions—not because it was ruthless, but because it was consistent.
That model is now under strain. Rising costs, digital competition, and the unforgiving economics of high- street retail have forced a reckoning. The brand, advisers argue, may be worth more than the business. The romance, it seems, is no longer bankable.
Sri Lanka’s corporate landscape tells a similar story— just at a different stage of the cycle.
Companies such as Hayleys, John Keells, Softlogic, and MAS Holdings were built as family enterprises with strong founder identities. Many successfully professionalised early, institutionalising governance before generational fault lines became fractures.
Others did not.
In Sri Lanka, family businesses often remain tightly held well into second and third generations, long after complexity demands separation between ownership and control. The result is familiar: boardrooms that resemble family councils, succession planning postponed in the name of harmony, and strategic decisions shaped as much by inheritance as by market logic.
The UK differs in one crucial respect: exit is culturally acceptable.
When British family shareholders decide to sell, it is framed as pragmatism, not betrayal. Legacy is honoured in press releases; proceeds are distributed; and life moves on. The market absorbs the brand, strips it to its essentials, and redeploys it for efficiency.
In Sri Lanka, selling the family business still carries stigma. It is whispered about as failure, or worse— abandonment. Yet the reality is often the same. Shares change hands quietly. Control erodes gradually. The family name remains on the letterhead long after decision-making has migrated elsewhere.
What Russell & Bromley makes visible is what Sri Lankan firms often prefer to obscure: that legacy is a liability unless it evolves into governance.
The hard truth is that family unity is not a business strategy. Love does not scale. Memory does not hedge risk. And stewardship without adaptation eventually becomes sentimentality—expensive, inflexible, and fragile.
In both countries, the critical fault line emerges at the same moment: when ownership fragments faster than vision. Some heirs want preservation. Others want liquidity. A few want relevance. And the market waits patiently, knowing that time is its ally.
There is no villain in this story. Only arithmetic.
Russell & Bromley may soon exist only as a brand— lighter, cleaner, unburdened by staff, leases, or history. Sri Lankan firms may follow different paths, but the destination is often similar: dilution of family control, professional management by necessity, or eventual sale dressed up as strategic partnership.
What differs is honesty.
The British are direct about it. The Sri Lankans are sentimental until the paperwork is complete.
In both cases, the lesson is the same: heritage survives only when it is institutionalised, not inherited. Everything else—romance, loyalty, even pride— eventually submits to valuation.
Markets do not hate family businesses. They simply refuse to indulge them forever.
