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Name A Japanese corporate colossus, and chances are it started as a family firm — Mitsubishi, Sumitomo, Toyota, Kikkoman. Hundreds of millions of Indians garb themselves daily in cloth made by the Ambanis or Wadias. Residents of Hong Kong can barely avoid contributing to the coffers of billionaire Li Ka-shing and his sons, who control office towers, supermarkets, electronics outlets and telephone companies. Business in Asia is a family affair, and the most accurate picture of an Asian economy remains a diagram of an extended family tree connecting clans that make things to those that finance them, with dotted lines sometimes leading to the government. The payoff for decades of commercial consanguinity has varied from nation to nation. For more than 30 years the impoverished Indonesian archipelago was run as a mom-and-pop operation by the ruling Suharto family. In contrast, South Korea's economic miracle was engineered by some 30 ambitious conglomerates called chaebol, almost all family controlled, while the commercial drive of industrious Hong Kong and Taiwan emanated from anthills of small, adroit family shops that promiscuously abandoned products and premises whenever better opportunities came along.

Today the majority of Asia's publicly owned companies are still family controlled, and the manner in which control is exercised often can be boiled down to one sentiment: a family business is the family's business. For decades top jobs at such companies have been passed down from fathers to sons and daughters, not to professional managers outside the clan. Profits have been used to shore up a sister (or cousin) company instead of going to shareholders. But if you talk to the patriarchs and scions of the families that own Asia, they will tell you that it is no longer business as usual. They have increasingly come under fire for inefficient, outmoded and nepotistic practices. One of the results of the 1997 Asian economic crisis was the devaluing of crony capitalism, that cloistered business-government cabal that parcels out national economic spoils to a privileged few.

Free trade, banking reform and global competition are making it harder for family businesses to carry on like secret societies. Shareholders are demanding transparency and calling for publicly owned companies to operate for the benefit of all stakeholders — not just gene holders. "The rules of the game have changed," says Jamie Allen, secretary general of the Asian Corporate Governance Association in Hong Kong.

For proof, look to South Korea, where conglomerates have long been "run like ancient tribes to maximize political power for the leading families," says Morgan Stanley economist Andy Xie. That changed with the '97 crisis, which caused the breakup of Hyundai Group and others and fostered an anti-chaebol backlash. Business life today in South Korea is marked by a steady stream of special investigations into chaebol-related bribery, stock manipulation, illegal campaign contributions, tax evasion and fraud. Chey Tae Won, nephew of the founder of SK Group, was jailed last year for accounting and stock fraud. Chung Mong Hun, the favorite son of Hyundai's founder, killed himself last year after being accused of illegally passing money to North Korean dictator Kim Jong Il.

Even with the pressure rising, many family empires are resisting change. "A small percentage of leaders is open and willing to face the challenge," says corporate-reform advocate Harvey Chang, president of Taiwan Cellular Corp., the island's largest mobile-service provider. "The rest just don't understand it." In the following report, TIME looks at five wealthy families who recognize that Asia's time-honored ways of doing business may no longer be tenable. These venerable houses, from the Lis of Hong Kong to the Moris of Japan, are to varying degrees tackling internal change, even to the point of considering the ultimate sacrifice: delegating top management to outside professionals.

• Anthony Spaeth