In Malta, where the labour market is notably tight, all businesses—including family businesses that form a significant part of the economic landscape—are finding it increasingly challenging to attract and retain the best talent. This critical scarcity makes it imperative for family businesses to address their unique structural challenges proactively, ensuring that inherent issues do not inadvertently deter the top-tier individuals who are already difficult to find. The successful coexistence and collaboration between family and non-family employees are not merely beneficial but essential for sustainable growth and a thriving organisational culture, especially when the talent pool is shallow.

The inherent intertwining of personal and professional lives in a family business can create a complex environment. While loyalty and shared values can be immense strengths, they can also lead to perceptions of nepotism, a “glass ceiling” for non-family members, and a lack of clear professional development paths. In Malta’s current labour climate, where skilled professionals have more options, non-family employees are particularly sensitive to these issues. They might feel that regardless of their performance, ultimate leadership positions or significant equity will always remain within the family circle. This perception, if not proactively addressed, can deter ambitious external talent who can easily find opportunities elsewhere, leading to high turnover among those who do join and further exacerbating the recruitment challenges in an already competitive market.

Furthermore, communication can become a minefield. Informal family discussions sometimes translate into business decisions without proper formal channels, leaving non-family members feeling excluded or uninformed. Performance management for family members can also be sensitive, potentially undermining a meritocratic system if not handled with impartiality and transparency. In a tight labour market, any hint of unfairness or lack of transparency will quickly send valuable talent looking for greener pastures, undermining the business’s ability to compete effectively.

To overcome these challenges and compete effectively for talent in Malta’s tight labour market, family businesses must adopt deliberate strategies that foster an inclusive, merit-based environment where both family and non-family employees feel valued, motivated and empowered.

1. Establish Clear Governance and Structures: Formalising roles, responsibilities, and decision-making processes is paramount. This includes creating clear job descriptions for all positions, family and non-family alike, and establishing boards of directors or advisory councils with independent, external members. Such structures provide objectivity, reduce ambiguity, and demonstrate a commitment to professional management—a crucial signal to potential hires in a competitive market.
2. Champion Meritocracy and Transparency: This is perhaps the most critical element, especially in a talent-scarce environment. Compensation, promotions, and career progression must be based on performance, skills, and contributions, not solely on familial ties. This, for example, highlights the importance of implementing clear, measurable performance appraisal systems applied equally to everyone. Non-family employees need to see and believe that their hard work and talent will be recognized and rewarded, offering a genuine path for advancement within the company, making your business a more attractive proposition than competitors.
3. Invest in Professional Development and Growth: Provide equal access to training, mentorship, and career development opportunities for all employees. Creating clear career progression frameworks, even if the very top leadership roles might eventually pass to a family member, ensures that non-family talent sees a future for themselves within the company. In a market where employees seek continuous growth, empowering non-family employees to “craft” their own jobs and pursue areas of interest can significantly increase their engagement and loyalty, acting as a powerful retention tool.
4. Foster an Inclusive Culture and Communication: Encourage open and honest communication channels. Regular team meetings and one-on-one check-ins should involve all employees, irrespective of their family status. Leaders, particularly family members, must lead by example, demonstrating humility, integrity, and a willingness to listen and learn from everyone. Creating opportunities for social interaction and team-building that bridge the family/non-family divide can also build stronger relationships and a more cohesive culture.
5. Define the Family’s Value Proposition Clearly: Help all employees understand what unique strengths and long-term vision the family brings to the business. When the family’s purpose and values are clearly articulated and translated into action, non-family employees can develop a sense of “psychological ownership,” aligning their efforts with the overarching mission. This shared sense of purpose can become a powerful unifier, differentiating your family business from other employers in a tight market.

Successfully integrating family and non-family talent yields significant dividends, especially crucial in Malta’s challenging recruitment landscape. It brings diverse perspectives, fresh ideas and specialised expertise that can drive innovation and adaptability, helping the business stand out. It creates a stronger, more resilient organisation, reducing dependence on a limited pool of family talent and ensuring business continuity. Ultimately, a workforce where every individual feels respected, empowered, and fairly treated is a highly motivated and productive one, directly contributing to enhanced financial performance and long-term success, and importantly, making your family business an employer of choice in a competitive environment.

The challenges and opportunities in integrating family and non-family talent are complex and multifaceted and exacerbated by the current tight labour market in Malta. This is precisely why attending the Award in Leading a Family Business course offered by EMCS Academy is so compelling. The course provides a structured and insightful framework to understand these dynamics deeply, particularly how they play out in environments with limited talent pools. It equips current and future leaders with practical strategies, best practices, and the necessary mindset to build truly inclusive, meritocratic environments that attract and retain the highly sought-after talent every business in Malta needs. From establishing robust governance to fostering transparent communication and developing fair compensation structures, the program offers the critical tools needed to effectively attract, integrate, and retain top talent, ensuring your family business thrives for generations by leveraging the full potential of every employee, family or not. The Award in Leading a Family Business course offered by EMCS Academy, will kick off on the 25th September 2025. Click on the above links to learn more about the course and to register. Funding is available for this course.