Ruling from the Grave: A Family Succession Controversy at the Taiwanese Evergreen Group

Published 26 Mar 2018
Reference 6386
Region Asia
Length 14 page(s)

The case highlights a bloodless succession coup that was over within weeks following the death of the founder of one of the largest conglomerates in Taiwan. In January 2016, Chairman Chang Yung-fa, 88, founder of Evergreen Group, died, leaving a handwritten testament disinheriting his three sons from his first deceased wife. All of his assets, plus the position of Chairman, were supposed to go to his only son from his second wife. Did that happen as the founder thought it would? Absolutely not. He had apparently overlooked the majority shareholdings of his first three sons, which made his will not worth the paper it was written on. The three sons voted, with their majority shareholdings, their half-brother out of the family-run business altogether. For one or two weeks, the young man nursed his ejection, literally—he had been CEO of Eva Airways, a key division of the conglomerate, and a respected pilot. But it soon dawned on him that his remaining assets—the modest sum of €1.5 billion—could be used to launch a new airline company in Taiwan. This is where the cases leaves the four Chang brothers. The case brings into sharp relief what can happen when no long-term planning is put in place by even the most respected of founders.

Teaching objectives

The case focuses the attention of students, execs, family leaders, next gens and all those interested in family business, on the critical importance of long-term planning. One of the biggest challenges facing owner-managers in family firms is the design and implementation of a long-term plan that will ensure the sustainability of their firms for decades to come. To this end, owner-managers will learn to go beyond the day-to-day activities to consider a diverse range of strategic questions that will come up in 10 or 20 years’ time. They will create a transparent system of rules and procedures so that the possible roles of individual family members are communicated well in advance of retirement, health problems or death. Owner-managers who have the courage to confront difficult and emotionally charged issues that arise in family businesses can thus avoid the type of breakup of a family-run business as happened to the Evergreen Group following the death of its founder.

  • Evergreen Group
  • Chairman Chang
  • Eva Airways
  • StarLux
  • Chang Yung-fa Foundation
  • Yang Ming
  • Evergreen Line
  • Family Succession
  • Taiwanese Conglomerate
  • Family Business
  • Chang Yung-fa
  • Chang Kuo-wei
  • Bronson Hsieh
  • TransAsia Airways
  • Q31718