As the landscape of Kenya’s business world continues to evolve, family-owned enterprises are facing a critical decision: adapt or risk losing relevance.

Frank Mwiti, CEO of the Nairobi Securities Exchange (NSE), advocates for one solution that promises not only sustainability but also the preservation of legacy—listing on the NSE.

Mwiti’s argument is simple yet profound: for family businesses to thrive beyond the founder's tenure, they must embrace external leadership, diversified ownership, and modern organisational frameworks that can steer them into the future.

"Listing on the NSE ensures the business outlives its founders by introducing new leadership and solidifying ownership structures," Mwiti explained.

Yet, despite the clear benefits, many family businesses prefer to remain private. Their reasons vary: the desire to maintain control, avoid cumbersome regulations, and safeguard traditional ways of doing business.

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In Kenya, where these privately held enterprises make up a large portion of the economy, it’s a reluctance that has kept many from exploring the possibilities of the public markets.

However, Mwiti sees this reticence as a missed opportunity. He notes that, with the right market conditions, family businesses can unlock hidden value through public listing.

"When the market is on an upward trend, listing allows owners to realise the true value of their shareholding," he said. This, he insists, is a crucial step toward achieving long-term financial health.

One company taking this step is Shri Krishana Overseas Ltd (SKL), a packaging solutions provider. In a bold move, the company revealed plans to list by introduction on the NSE in July 2024, targeting the exchange's Small and Medium Enterprises (SME) Market Segment.

This would not only make SKL the first packaging firm to list on the NSE but also mark the first new listing since 2020.

The company’s Managing Director and Founder, Sonvir Singh, shared his vision behind the decision.

"Listing on the NSE’s SME Market Segment is a strategic decision that will provide Shri Krishana Overseas with access to the capital markets, enabling us to raise funds and accelerate our expansion plans in the near future," Singh explained.

As demand for sustainable packaging grows in sectors like floriculture, horticulture, and pharmaceuticals, SKL plans to expand its operations to meet this need.

For family-owned businesses eyeing growth, the path to public listing might seem daunting, but as Mwiti and Singh’s examples demonstrate, the rewards of joining the NSE far outweigh the risks.