Q I am very concerned about business intelligence being leaked to rivals. Can I keep my information out of databases such as Dun & Bradstreet?

Name withheld

You cannot keep information out of Dun & Bradstreet by asking the company to remove your reports from its database. But that may be a good thing. By hiding your light you risk desirable people bypassing your bushel. A company's nonappearance may raise unease among the many lenders and potential clients that use business databases--Dun & Bradstreet in particular--as a financial reference.

And it's not as though nosy parkers can't glean the same information, and more, from other sources. Thanks to the Internet, you can find out what your blind date's ex-girlfriend thinks of him before he even rings the doorbell. D&B gathers data from such public places as the U.S. Postal Service, industry directories, and published articles, says Vicki Raeburn, the company's chief quality officer. It also buys financial information from banks and other lenders and uses data from corporate accounts-receivable records to create credit scores. The least expensive reports that rivals, lenders, and potential clients can buy include the basics: staff size, sales figures, and executive bios, along with industry profiles. In-depth reports cover financial performance, lawsuits, liens, judgments, and bankruptcies. The information is not verified with the company before it is published, Raeburn says.

So you can't eliminate your D&B file altogether. But you can plug leaks by checking out lenders' information-sharing policies before opening a bank or credit card account, suggests Joann Brown Williams, a business lawyer at Atlanta-based Krevolin & Horst. You can also request a free copy of your company's D&B report and correct inaccuracies by calling D&B's customer service line or visiting its website (dnb.com). Such information is worth checking frequently. After all, if you can't stop people from talking about you, you should at least know what they're saying.

Q One of my daughters works in my business and will one day take the reins. My other daughter isn't involved. I'm afraid that giving them both equity will cause problems. What are my options?

Rob Auerbach, founder
Rainbow Blossom, Louisville

If you doubt family business can get nasty we suggest cracking your college edition of King Lear. Only 30 percent of family-owned companies survive the succession process, according to research by John Ward, a family business professor at Northwestern University's Kellogg School of Management. And sibling rivalry is one culprit. Splitting equity may pit sibling against sibling and stall decisions. Multiple stockholders can hamper the company's ability to move quickly. Family members with a vote but little knowledge of the business also gum up the works.

Ernesto Poza, a professor of family business at Case Western University, proposes an alternative: Grant sole ownership to the daughter who works in the business and give her sister a bigger chunk of your estate. Start by hiring an appraiser to perform a valuation of the company. If it's worth more than the rest of your estate, consider offering the nonowner sibling enough nonvoting common stock to balance matters, Poza recommends. A tax planner and an attorney can draft a contract stating that the child can sell back the stock to her sibling in small installments, plus interest.

Lear sought unbiased wisdom from his fool; a better option is to consult a good board of directors, especially if your uninvolved daughter expresses interest in joining the family business after you retire. Four years ago, Jack Cakebread had to choose a successor from among his three sons, the youngest of whom worked at the family's Napa Valley winery, Cakebread Cellars. Unwilling to play the heavy, he asked his offspring to devise a solution among themselves and present it to the company's board for approval. The board agreed that the three should divide the business equally and installed Bruce, the youngest, as president and COO. Dennis became senior vice president of marketing and sales, and Steve is an unsalaried adviser. The arrangement works well, and the siblings still consult the board whenever they disagree--something that happens even in the best of families.


Check out the Better Business Bureau's website to learn more about protecting the privacy of your business and customers. For more succession tips, read Keep the Family Baggage Out of the Family Business by Quentin Fleming.

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