How the Esquel Group unexpectedly ended up all in the family

Liza Tan | Executive Producer
Workers sew clothing at the Esquel Group garment factory at the Vietnam-Singapore Industrial Park in Thuan An, Binh Duong province, Vietnam, in June 2014.
Brent Lewin | Bloomberg | Getty Images
How shirtmaker PYE caters to evolving preferences

For Marjorie Yang, Dee Poon is a daughter, a co-worker - and one very successful corporate experiment.

Esquel Group Chairman Yang brought in Poon as chief brand officer of clothing label PYE in 2009. Her remit: refresh PYE, which at the time was an ailing part of Hong Kong-based apparel maker Esquel's business.

Esquel specializes in making shirts wholesale for global retail brands including Ralph Lauren and Brooks Brothers, while PYE offers the company's shirt-making expertise direct to retail customers at its own high-end stores.

Poon tells CNBC's Bernard Lo that Yang asked her to join PYE as an "experiment."

"We have a business that isn't making any money and you can't screw up worse than anyone else and you will learn a lot," she recalls of her mother's thoughts at the time.

Marjorie Yang, Chairman of Esquel Group.
ChinaFotoPress | Getty Images

So Poon quit her first job - where she says she was making 12,000 Hong Kong dollars a month ($1,545) - and joined the PYE "start-up."

She says, only half-jokingly, "Let me just say, after my first year at PYE, I was definitely making less than that!"

The payoff, Poon says, was that she was lucky to be groomed and mentored by her mother - even though Yang says the two are so much alike, she feels alternative mentor is needed.

"It's too much down the same path and I think [Poon] recognizes that, sometimes, there is a problem, I am too much like you, and that's not necessarily good," Yang admits.

To illustrate how similar they are, the mother-daughter duo recalled a game they played at a Young Presidents' Organization event,where they were asked a series of questions. One of those questions was, which button do you start with when you button your shirt?

The options for answers were "from the top" or "from the bottom." Unbeknownst to each other, Yang and Poon both ignored the available options and and instead answered "from the middle."

Siblings working in harmony? It's possible

Despite their obvious rapport, the tight-knit pair were never meant to end up working together. In fact, when patriarch Yang Yuan-loong set up Esquel in 1978 - the same year China opened up to the world under Deng Xiaoping's series of economic reforms - he didn't intend it to be a family business.

"My dad didn't want us to be in this industry," Yang says. "And one thing led to another, you know China is opening up, and then Esquel came about because of China opening up. That's the beginning of the company."

Likewise, Yang's younger sister Teresa, a hotel management major, didn't plan on joining the family business, but as the company grew quickly, she got roped in and is now Esquel's vice chairwoman.

Yang explains, "We were growing very fast and we really needed competent people."

With manufacturing operations across five Asian countries, Esquel produces 100 million garments annually. But Yang says making a difference is as key as making profits.

I always say to my colleagues, having a good heart isn't enough, one must also have the ability, the knowledge and also the guts to do things.
Marjorie Yang

Yang believes the most important corporate social responsibility is to create quality employment.

"That's the way to take everybody with us rather than just, or rather, the owner takes all," Yang says.

It's a sentiment her sister shares, which is why they're happy keeping the company private.

"We will not forgo our long-term interests, which is really the culture that we are building right now," Teresa tells CNBC.

"Usually for any listed companies, the first thing that you take care of is really the short-term profit," she says. "That's often one of the reasons why a family business will still have an advantage, because we can say that 'this is really what we want to do and it is not only for a short-term profit but is for the long-term interests of the company as an ongoing business entity'."