Thermax: Four paths to succession in a family business

From its origins as a manufacturer of hospital equipment for the Indian market, Thermax has grown into a multinational corporation operating in 90 countries, offering integrated solutions in heating, cooling, power generation, water treatment and recycling, air pollution control, and chemicals with a focus on ensuring clean air, clean energy and clean water. The founding family, which owns a 61% stake in the firm (the rest being publicly held), has steered the company toward helping speed the transition to renewable energies via the development of greener technologies. In addition, the family has shown unwavering commitment to social responsibility and philanthropic endeavors. The case features a detailed history of Thermax’s evolution as a family business, with a particular focus on how the family has navigated the challenges of intra-family succession. The dilemmas faced by owner-managers as they hand over the reins of the family business, combined with the outsize impact of succession on the future performance of a business, have contributed to making succession the single most studied topic in family business research. The Thermax case study illustrates the varied forms succession can take over the course of four generations. It also explores the different ways family members can contribute to the family enterprise system via operational roles in the company as well as involvement in board governance, ownership governance and philanthropic work. The case is based on interviews with five members of the founding family, all of whom hold (or have held) executive and/or operational roles in the company. The dynamics of intra-family succession form the crux of the case. Since the company was created in 1966, each generation has brought different leadership qualities and competencies to their respective roles and has contributed to making Thermax a leading conglomerate in the energy and environment space.

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