Blocks of wood with DIY letters

Family Governance – Do It Yourself?

For enterprising families to remain successful over generations, they will eventually need to begin to take their family governance seriously.

As a family grows, and as their wealth becomes more complex, they need to figure out how they will address important questions relating to ways they’ll make decisions together, how they’ll communicate, and how they’ll solve problems as a group.

The very idea of going down this road can be frightening for some, but it doesn’t have to be.



A Bank Slogan to the Rescue

The idea for this post came a few months ago when I was in the lobby of a downtown office building, which also housed a large branch of one of Canada’s major banks.

While killing time because I was early for my meeting, I was looking around and I noticed a banner for one of the bank’s investment services.

It read:

“Invest FOR yourself, not BY yourself”

Hmmm, I thought, that’s pretty straightforward and quite clear messaging.  It also happens to apply, in a way, to my ideas around family governance.


FOR the Family, BY the Family

If you’re familiar with my writing, you likely already know that when it comes to family governance, I believe it really needs to be done “For the family, by the family”.

But, I never said it needed to be done by the family, by themselves!

In fact, I can think of a number of reasons why a family shouldn’t turn the development of their governance procedures into a complete “Do It Yourself” project.

Let’s take a look at a few of them.


sunset and a lighthouse


Get on Track, Stay on Track

Developing governance systems is actually quite a project.  And, it’s often a project that really isn’t anyone’s “job”.

Sure, getting started and keeping it going often falls to one or two key people, but it’s never the only thing that they have to worry about.

Hiring someone to guide you in this project means you also have someone who will keep things on track, because it’s really pretty easy to let things slide if nobody is making sure that things are continuing to evolve on a more-or-less regular basis.



Third Party Neutral

Establishing family governance naturally involves getting a number of people together to discuss many important details.

Even though the people are related, that doesn’t necessarily mean that they’ll always agree on everything.  Discussions can get personal at times, and that’s another reason to bring in an outsider.

A trained facilitator will also bring an objective, neutral viewpoint that just isn’t there when the only people around the table are family members.



Things Don’t Happen By Themselves

An expression that I use frequently is “things don’t just happen by themselves”.

I guess I already covered this in my first point, but it bears repeating.

An outsider who comes in with a mandate to make things happen is more likely to help the family persist, even in times when they begin to feel like they’re not making progress quickly enough.



Hire the Expertise You Need

Enterprising families usually have a wide variety of human capital to draw from, as many family members have useful talents that help the family continue to be successful.

However, it’s pretty rare for a family to have exactly the expertise required to lead the development and implementation of their governance procedures.

The good news is that there are people who know what needs to be done and can be brought in as the important resource that the family needs.



Architect, Contractor, Decorator

When you bring in such an advisor, you’re looking for someone who is partially an “architect” to get the design right, but also partially a “general contractor” who will help build it.

As things progress, continuing on my building analogy, you will also want to benefit from that person’s expertise and experience as kind of a “decorator” who helps the fine-tuning as well.



Guidance and Facilitation

Ultimately, you will need someone who can provide the guidance you need as well as the facilitation required to get the family to come up with the systems themselves.

Ideally the family will co-create their governance.  You cannot just “buy” your governance from a consultant, although that doesn’t mean that there aren’t people who will try to sell it to you.

I suppose you could “save time” and buy it, but most family members won’t buy into a system if they weren’t part of creating it. It just won’t stick.


Ikigai: A “Four-Circle Model” of Human Capital

This week we’re going to look at an interesting model that I came across last year, and talk about how it might apply to enterprising families.

When I first saw it, I mistakenly thought that it was already quite well known, but it doesn’t seem to be.

At the FFI conference last fall in London, one of the presenters had it on a Powerpoint slide and asked how many people were familiar with it.  With dozens of people in the room, I was one of less than a handful of people to raise my hand.

The model comes from Japan and is called Ikigai, and the sub-title of the graphic I found calls it “A Japanese concept meaning ‘A reason for being’”.

Ikigai: A “Four-Circle Model” of Human Capital

Pretty Heady Stuff

I guess that makes it seem like pretty heady (and potentially “heavy”) stuff, but I promise not to go too far afield here.

As usual, I want to look at how things affect families, whether they run a business, have a family office or are simply part of the “ultra-high-net-worth” set, and are concerned with raising their offspring to have meaningful lives.

For most parents, few things are more important than raising our children, with the long-term goal of having them turn out to be well adjusted and happy.

Some adopt a pretty laissez-faire attitude towards their offspring’s career goals, while others are quite directive.


What You Love, What You’re Good At

The old standards of “do what you love” and “find something that you’re good at” are still as pertinent as ever when we try to guide our children as they make choices while they’re coming of age.

Of course there are a number of other considerations that also come into play, and the Ikigai brings up a couple of them.

Some people will look at the other dimensions and quickly agree that they are also important, but my point here today is that they don’t necessarily apply equally to everyone.


Show Me The Money

In addition to loving what you do and being good at it, for most people it’s also important to get paid for their work, so finding something that you can be well paid for is often very important as well.

Notice that I said “often”, and not always, because I’m not talking about “most people”.

Families that have already succeeded at accumulating significant wealth can prove to be important exceptions here.


What the World Needs

Personally, I’ve seen other models that noted the three aspects we’ve already covered, but the one “new” or added dimension is the one where you also consider “what the world needs” in the mix.

This seems to fit quite nicely with the way many Millennials are typically portrayed.

More than ever, it seems that many in the younger generation truly care more about the collective than they do about increasing their own riches.

So in some cases, people may find it more compelling to look for careers where they feel like they are making a positive impact on the world, as a higher priority than making a lot of money.


Different Generation, Different Drivers

Trying to find something that checks all four boxes may seem like a low-percentage game.

That doesn’t mean that it can’t be done or that it isn’t worth trying though.

Plenty of people have done well and lived very rewarding lives while only really “succeeding” in a couple of the four areas, thank you very much.

Many parents have sacrificed a lot and worked at jobs that they never loved but needed to do to provide for their families, with the hope that someday, their kids could have a better life.


The Resource Generation Set

I recently came across an organization that’s attracting many young people from financially wealthy families who want to make a difference in the world.

They call themselves Resource Generation, and appear to want to help create a world with more equitable social justice.

I’m sure that those who are involved must have some very interesting dinner conversations with their families.

It appears that there are indeed some people who are more concerned with the way the world works and less concerned with making money, because they already have plenty.

And I think that the Ikigai model can go a long way in helping families discuss these important subjects together.

Questions Don’t Always Require Answers | Family Business Guidance

Questions Don’t Always Require Answers

I sometimes use this blog to talk about abstract ideas that seem only tangentially related to the fields of family business and family legacy.  This will likely be one of those posts.

The genesis of the idea for this piece came back in October in London, at the FFI conference, when I was speaking with a friend and co-presenter about the role she plays on a family business’ board of directors.

During that conversation she related some feedback she got from the family patriarch, who told her that he liked the fact that she “asks great questions”, and, here is the good part, she “often doesn’t even care what the answers are”.

Of course I quickly thanked her for a great blog idea!

Reasons for Asking Questions

This of course got me to thinking about why people ask questions in the first place.

There are plenty of different reasons that people ask questions, depending on lots of different elements, and the context in which said questions are being asked.

But simple logic would seem to dictate that when someone asks a question, they are interested in the answer!

Indifference Versus “Not Caring”

This brings us to an important nuance in what I’ve written above.  First of all, I’m not sure that my quote from the patriarch is verbatim.Questions Don’t Always Require Answers | Family Business Guidance

But more importantly, I want to make it clear that neither he, nor she, nor I, believe that she truly doesn’t “care” what the answers are.  It’s more about the fact that she is indifferent to the answer.

And that of course makes me think about how often people ask questions where they have a predetermined expected answer that you will either get “right” or “wrong”.

Coaching Questions

When you ask someone a question, there are literally an unlimited number of ways you can phrase it.  And we won’t even get into the tone of voice and other non-verbal aspects, because that could be a whole other blog, or even a book.

Those who have taken coaching courses have learned that there are certain types of questions that typically yield better results, and I’m pretty sure that these are the kinds that my colleague uses in her role on the board of that family business.

Most people have heard about the idea of avoiding questions that can be answered with Yes or No, i.e. open ended questions.  That’s a great start, and it also requires that you then listen to the answer, which will then be longer than a single word.

Don’t Ask Why

Another “rule” that I try to hold myself to is not to ask questions that start with “Why”.

Even though it’s not always the case, very often the person hearing a question that starts with “Why” will feel put on the defensive, and feel the need to “explain themselves”.

When people answer questions from a defensive stance, it doesn’t necessarily add to a productive discussion.

If you truly want to understand what someone was thinking, because you are curious, and not simply judging them, there are better ways to ask these types of questions.

What and How

Simply abolishing the word “why” and replacing it with a much softer “what” or “how” can make a surpringly big difference.

“How did you come to the decision to do that?” or “What was going on at the time that lead to that decision” are not that much different in terms of the insights that the asker of the question wants to know.

But these last two questions will likely land much more softly, and in turn yield a more useful answer, that can then send the conversation into a more positive direction.

Past Versus Future

A board of directors will normally spend much of their time looking to the future rather than dwelling on the past, and this is where some really interesting opportunities for questions can arise.

Some of the best will start with “What if…” and they bring up many possibilities that make people think about what could be.

Whatever the circumstance or context, the best questions are usually driven by real curiosity, and not with any judgement.

This is sometimes easier said than done, but like most things, practice makes you better at it.

The curious attitude of the questioner usually comes through loud and clear.

Family Governance: One Step at a Time

Family Governance: One Step at a Time

Writing this blog every week allows me to share my thoughts on subjects relating to enterprising families and wealth continuity, and to talk about some of the best conferences I attend in this field.

There is a relatively new event on the calendar that is quickly becoming a favourite of mine, the Institute for Family Governance’s conference.  This one-day event in NYC has taken place in late January the past 3 years, and will be back again in 2020.

And it is great fodder for this blog! 

After IFG in 2017, I wrote Family Governance, Aaaah, and then last year Realistic Family Governance Goals. But this year, in addition to this piece, I’ll be following up with at least a handful of posts inspired by the conference.



Real World Experiences

As I wrote on their feedback survey, the highlight for me was the fact that there were so many examples of real families and what they have been doing in the area of family governance.

Of course there were presentations by practitioners who work with wealthy multigeneration families, but there were also plenty of people from families who shared their stories.

Now family governance is of course a niche, which I know based on some of the blank stares that I get from many people when I talk about the kind of work that I do.

The US Customs agent who asked me why I was going to New York sort of shook his head and tried not to laugh when I said the I was heading to a conference on family governance.

So the more we can get practitioners and families to share their experiences, about what real families have done and continue to do, the better for all of us who serve this field.


Frames of family pictures hanging on a wall of a house

Time, Work, Practice, Leadership

There was a panel in the afternoon where one participant talked about an important decision his family made years ago when they hired a well-known family business consultant.

There were some such consultants in the audience of course, and you can imagine how all of our heads were nodding along.

But there was something else this man said that I noted, because it echoes a message that I find myself repeating a lot.

It didn’t seem to be a prepared or rehearsed remark either, just a genuine reflection about family governance in general.

I quickly jotted down the four main words that he mentioned when talking about his family’s governance efforts.

“This takes time, it takes work, it takes practice, and it takes leadership



Doesn’t Just “Happen”

One of the ways I usually put it is to say that this stuff doesn’t just “happen” by itself.

One of the words I often add is “intention”, because being intentional is one way to describe it.

But the four words that he used really rang true, probably because he seemed to be saying them from his heart and literally from the top of his head, not on some prepared slide for a presentation.



Time and Work


Family governance does indeed take a lot of time, both in terms of manhours and in terms of months and years.  That’s why I always urge people to start before they feel like they really need to; it’s almost never too early.

The amount of work involved is often more that the family expects at the outset.  I’m sure that most advisors who work with families have had the experience where some family members start to feel governance “fatigue” at times.



Practice and Leadership

While time and work are common elements that may discourage families from implementing governance, practice and leadership are part of a different category.

Practice may not always make perfect, but his point was that you do get better at it as you do more of it.  Working with family members isn’t always easy, and we need to do it repeatedly to get better at it.

That leaves leadership, which is also required.  I would add that if there is only one leader who cares about it, the family likely won’t get very far.

If I were to change one thing in the quote I might swap out the word “leadership” and insert “leaders”, just to emphasize that it’s not a one-person job.

But of course we all recognize that good family governance must involve many family members, right?


Money bags with plants growing on top

Family Offices and Impact Investing: A Great Fit

This week we’ll look at a couple of subjects that have been written about a lot over the past few years.

I’ve written about the family office space recently, and promised to write about more often.  Impact investing, on the other hand, I’ve not written about, yet.

It’s interesting that more people are beginning to realize that family offices and impact investing actually go together like peanut butter and jelly, or ham and cheese.

I’m not claiming to have unearthed anything new here, but want to comment on some aspects of this combination that give it so much potential.



Millennials on the Mind

Let’s start with the premise that many family offices are essentially investment vehicles for wealth that is owned by a family.

Let’s add in the fact that these families want to keep their wealth in the family, and that much of that wealth is often liquid wealth, which can be invested in a wide variety of asset classes.

And finally, let’s not forget that when the wealth (eventually) gets transitioned to the rising generation of the family, there are likely going to be some millennials involved.

If you Google “millennials impact investing” you will get all sorts of hits.

Much of the mindset that impact investors bring to the table overlaps almost perfectly with everything that I’ve ever read about millennials.



Family Engagement

Anyone who works with wealthy families knows that a key obstacle to successful wealth transitions has always been the difficulty in getting and maintaining the engagement of the younger generation of the family.

It’s only natural for young people to want to find their own way in the world, to explore and develop their own passions, and follow their own dreams.

Their parents, who are currently stewarding the family’s wealth, and who may have been involved in creating and growing it, often become anxious when their offspring do not show any interest in these efforts.


family Business office

Generational Priorities Converge

So for families who have liquid capital to invest in different asset classes, it isn’t much of a stretch to begin to look at investments in companies or funds that look to make a positive impact in an environmental and/or social fashion.

Impact investing is about making money first and foremost, just not at any cost.  If younger family members can identify potential investments that satisfy both a social benefit along with an opportunity to make a financial profit, it should be a no-brainer to consider such opportunities.

I’m thinking about this from the point of view of a family that is trying to find ways to combine what is important to all generations of the family.

For a family office to look seriously at impact investing even takes into account future generations, including young children and those who aren’t yet born.



Like Philanthropy, But Different

Some people confuse impact investing with philanthropy, so let’s address the comparison here.

Philanthropy is another way that some wealthy families use to bring the family together and help prepare the rising generation.  Working together on a family foundation is a nice way to learn financial literacy and how to work together with others.

Families who understand and teach their younger generations the importance of giving back to their community have realized that there are lots of win-wins here.

But impact investing is different, because it’s actually about finding ways to invest money for profit, not just out of a sense of charity.

It just isn’t about profit without regard to side effects and unwanted consequences.



Who Gets to Decide?

Of course it’s easy to say that family offices should take impact investing seriously and start doing it.  It’s another to figure out how to do it, including asking the questions around “who gets to decide?”

We’ve looked at “what” to do (impact investing) and we’ve explored a bit of the “why”, (because of the engagement of all generations), but that still leaves a lot of the “how” questions.

A few weeks back, in Putting “Family” in the Family Office, I noted:


Ideally, the goals of the family would also

be taken into consideration too, not to

mention the family’s mission and vision


Impact investing needs to be driven by the family’s vision to really succeed.

Global FamBiz Students Compete for Glory

Global FamBiz Students Compete for Glory

The University of Vermont recently held the 6th edition of their Global Family Enterprise Case Competition(FECC) in Burlington.

It was great to see this fantastic event back on the calendar after a one-year hiatus as they awaited completion of their brand new digs.

I was privileged to be back to serve on a couple of judging panels, a role I had enjoyed at 3 of their previous competitions (2014, 2015, 2016).


Truly Global Reach

I was scheduled to judge on Thursday and Friday, but because Burlington Vermont is only about an hour and a half from home, I decided to head down in time to catch the first round on Wednesday afternoon.

There were 13 teams in the undergraduate division and 12 graduate teams.  They had been drawn into divisions Wednesday morning.

As it happened, the “FFI Division” consisted of four teams from outside North America: China, Guatemala, the Philippines and Spain.

I decided to spend the afternoon watching that division because of its diversity.

Let’s just say that I was quite impressed with the caliber of presentations, even before considering the fact that most of them were working in their second or third language.

universities participating in Global family business competition

Tell It To The Judge

On Thursday my work truly began.  I was the lead judge of my panel, and as it turned out, I was also the oldest of the four judges, probably by at least a decade and a half.

We saw presentations by undergraduate teams from Canada, USA and Mexico.

Our task was to rank the four teams in order after we had seen them all present and survive our Q & A period.

As luck would have it, all four judges came up with the same rankings so our deliberations were quick.  This allowed us plenty of time to provide what we hoped would be useful feedback for the teams.

We also spent some time on allocating our six stars (points) for best presenters from the teams that we saw.  There were lots of worthy candidates to choose from.



Disagreements Happen Too

On Friday, the judging panels were mixed up again and I ended up with 3 new people on my panel, and I was no longer the lead judge.

We were in a graduate division, and the teams we saw were from Canada, USA, Germany and Sweden.

When it came time to determine our rankings, unlike the previous day, the four of us were all over the map.  There were three teams who received a top rank, including one that had received a fourth-place vote as well.

This deliberation wasn’t as simple as the previous day’s.


 study rooms for students at a university

Not Much Difference

Family business cases, whether in real life or as captured by those who write cases for University classes and case competitions, are always very subjective.

By “subjective” I mean that every person can interpret everything they read, see, and hear according to their own personal filters, experiences and understanding.

When the teams completed their 20-minute presentations, we had a 10-minute Q & A to probe for more depth and clarification.

We got to hear a lot in that half hour, but considering these cases were based on real-life situations that had decades of history behind them, we were really only scratching the surface.

In the end, the difference between first and fourth was not very large on either day that I judged.



Better Every Year

From the first time I attended FECC until this year’s edition, things have been getting better every year.

Likewise the field of family business as a subject that Universities teach is also advancing, and the profession of advising business families continues to move in positive directions.

If this blog post is starting to sound like it’s coming from a big fan, then you’re reading it correctly.  If it also sounds like I am angling for an invitation to return as a judge next year, that’s also a strong possibility.



And the Winners Are

On Saturday night the winners were announced.

Congratulations to the undergraduate winners, from Carleton University in Ottawa, Canada.

In the graduate category, the winning team was from the University of Adelaide in Australia.

Click here for all final results.

And the whole University of Vermont crew deserves kudos once again for a fantastic job of creating and hosting this unique event.

Kid laughing on the bench

“Nose In, Fingers Out” for Family Business

“Nose In, Fingers Out” for Family Business

Today’s topic is one that I’ve been thinking about for a while, ever since I first saw it mentioned back in 2017.

If you Google “nose in, fingers out”, you’ll see that it has been used by a number of people, attesting to its usefulness in creating a mental image that most people can quickly grasp.

I need to give a hat tip to Larry Putterman for putting it on my radar screen first.



It’s All About Boundaries

A topic that arises often in business families is that of “boundaries”, and there are many reasons for that, and anyone who has ever worked with, or in, a family business knows what I’m talking about.

But while the “nose in, fingers out” idea is about boundaries, it is also a subtle way to discuss how boundary lines are not all necessarily a solid concrete wall, but perhaps just some steel slats.

Boundaries are important, but we need to think about, and talk about, what the boundaries are supposed to accomplish, if we are going to establish the optimal boundaries for our situation.



From CEO to Chairman

The area that Putterman specializes in is Boards of Directors, and in the family business context what he is most often referring to relates to a person who has decided to scale back their involvement as part of a transition.

The former leader of the operations of the business, likely the CEO, has decided to pass on the reins of the operations, but to stay involved in a lesser capacity, and not disappear altogether, at least not yet.

There are different ways to take these kinds of steps gradually, of course.  My father brought in a non-family President and stepped into the Chairman role, but kept the CEO title for himself for a while.

Quite often the biggest step is the one where the CEO mantle is relinquished, and only the Chairmanship is retained.



How Much Is Out, How Much Is In?

In a family business, an outgoing leader will (hopefully) get to the point where, for many reasons, it makes more sense to scale back their involvement, moving from day-to-day operations to more of an oversight role.

These kinds of transitions happen all the time.

But sometimes they work out well, and other times, well, they just create problems.

This is where the “nose in, fingers out” idea comes in.



What Is Permissable?

The devil, as they say, is always in the details.

The nose and the eyes go together, so you are allowed to look around and sniff around as much as you like.

As you would expect in an oversight role, continuing to observe whatever is going on in the company is allowed and even required.

Below the nose is the mouth, of course, and this is usually the first place that problems begin to arise.



The Mouth Can Be a Finger (?)

If the nose and eyes go together, does that mean the mouth does too?

Probably not.

Once you step back from the day-to-day to oversight, what you say to people, at least those who are involved in the daily operations, needs to be weighed very carefully.

Problems and confusion arise quite quickly when the old boss walks around and tells “his people” what to do.

In fact, it is at this point where the mouth has become tantamount to a finger.



Encouragement Yes, Direction No

When the ex-leader talks to the employees, care must be taken to limit their words to encouragement and not direction.

When they are in a board setting or discussing things with others involved in oversight only, then the mouth is once again an agent of the eyes.


Road directions in a desert


What About Other Family Members?


There is another area where the nose in, fingers out situation comes up in family business that I’d also like to touch on here.

It’s the one where family members who do not work in the business interact with others, often siblings, who do.

There are boundary issues here as well, as those who don’t work there have an information disadvantage that they usually need to overcome.

Sometimes their questions seem a little too much like fingers in, rather than just noses.

For those being questioned, the best defence for this is to try to be as transparent as possible, and to get out in front of any questions.

If you satisfy their noses, they will be less tempted to poke their fingers in.



Boat at sea

Equanimity: Yours for only $250 Million!

Every so often, I hear a word that sounds kind of familiar to my ears, but that also gives me a bit of an uncomfortable feeling.

Usually, the feeling is one of guilt, because that newish, cool word sounds like something that I really should understand, but I’m not 100% sure that I do.

Alas, we cannot know all of the words, and even if we learned one new word every day as some might suggest we do, I’m not sure you could ever learn them all.



Audible Strikes Again

Over the past few months, I made a few trips to our cottage to work on my next book, and I’ve been taking advantage of my subscription to Audible, the audiobook division of Amazon.

When I listen to music while driving, it sometimes puts me to sleep, so audiobooks have been a godsend.

I recently listened to a couple of books about meditation and mindfulness, and it was in one of those that the latest “special” word struck me: Equanimity.

It sounded majestic and important.  But I didn’t feel like I knew enough about it, even though I was falling in love with the word.



Let’s Google It

As recently as a few years ago, I would have gone to the bookshelf with the dictionaries and thesaurus and looked it up, but like many people I just Google everything now.

Lo and behold, thanks to some dumb luck with timing, there was a news story out about the world’s most expensive yacht that also happened to have a cool name: Equanimity.

Like a little kid seeing a shiny object, of course, I had to read about this huge yacht that the Malaysian government had just seized that was said to be worth $250 Million.

I’d worry about the definition later.

I even watched a Youtube video of the scandalous Asian billionaire owner getting his first tour of the vessel a few years earlier.


Dressing store

Definitions and Meanings

But let’s get down to business here.  From Google, here are some definitions and meanings I liked:

mental calmness, composure, and evenness of temper,

especially in a difficult situation.


Equanimity is a state of psychological stability and composure which is undisturbed by experience

of or exposure to emotions, pain, or other

phenomena that may cause others to lose

 the balance of their mind.


Stable and Composed

Most people probably like to think of themselves as stable and composed, and I guess that most of the time they are correct.

The problem isn’t what happens “most of the time” though, the trouble is what happens “in a difficulty situation” or when “emotions and pain” are part of the equation.

And when you happen to work with other family members, you know that emotions and difficult situations come up all the time.



Be the Bigger Person

I always say that the only person you can control is yourself, and so the onus is on each and every one of us to strive for our own equanimity, and try to be the most stable and composed person that we can be, in every situation.

Can meditation help you become better at this?  I think it can and there is more and more research all the time that supports this view too.

But before we can get too far, we really have to make a personal decision that this is something that we really want to do, and that we are ready to make the efforts that will be required.


Finding Inner Peace

In July 2018, in Rest in Peace, While You’re Still Alive, I wrote about this as finding peace,

But whether we call it peace, calm, composure, or equanimity, it really doesn’t matter, because we all have different versions of it that resonate with us better.

The important thing is to work on getting better at self-awareness and self-control.



Good for Each Generation

Whether we’re talking about the “now generation” who are currently running the family business, or the “next gens” who are rising to eventually replace them, this is equally important.

It even helps if you have advisors or coaches who exhibit equanimity to help you along the way.

I’ve been in meetings with families where everyone was even tempered, and I’ve been in others with other families where tempers really flared.

Even a little bit of equanimity goes a long way.


Guy sitting in his office facing a window

Putting “Family” in the Family Office

Back in September in From Family Business to Family Office, I finished up by noting that I’d be writing about the family office space more frequently going forward.

I diligently followed that up four weeks later with another post on the topic, Family Office: “WHAT” vs. “HOW.  But that was more than two months ago, so this is slightly overdue.

Coincidentally, I just came across an article from a recent issue of The Economist on the subject, which I found interesting, called: How the 0.001% invest.



An Investment Vehicle

An important angle of that story is evident from their secondary title:

“The family offices through which the world’s

wealthiest 0.001% invest are a new force in

global finance that few have heard of”

The story makes the point that some of the giant family offices from around the world are making waves in the financial markets like never before, which is causing them to be talked about even more.

I typically don’t talk about the “0.001%” very much, on the assumption that they are already quite well served, and because they constitute a tiny fraction of people who could ever use my services.


Where is the Family?

I typically write about things that actually concern the families themselves, even though most people care only about their money.

The number of people who would bend over backwards to cater to the “super-rich” to manage their wealth is huge.

The number of people like me who want to be a resource to those families as they manage the family aspects of their intergenerational wealth transitions is comparatively tiny.

So it’s up to me to ask the question, then, “Where is the family in the family office?”



Family Members as Clients

Well if the story from the Economist is any indication, nobody really talks much about the family members themselves, preferring to concentrate on the family’s wealth, and ways to increase it.

This also happens to be where most of the professionals make their money, by helping the family office make money.

The members of the family, for whom all of this work is ostensibly being done, are rarely mentioned.  They are, though, the “clients” of the family office.

Because every family office is unique to the family it serves, it is hard to know how many of them actually have deeper levels of family involvement in the work the family office does.


 Meeting room for family

Values, Goals, Mission, Vision

Because many family offices come about as the result of liquidity events in family businesses, many of the same issues are often found there.  Some are simpler than those in an operating business, while others are more complex.

See: Huge Liquidity Events – Great News, Right?

Hopefully, the family office is not simply making investments based on maximizing returns, if those investments would go against the values of the family.

Ideally, the goals of the family would also be taken into consideration too, not to mention the family’s mission and vision.

This, of course, pre-supposes that the family has worked together to define their values and agree on the goals, mission and vision of the family.

I’d guess that very few family offices are currently benefitting from that kind of guidance from family clients who’ve done that important work.



Family Office as a Catalyst

Regular readers know that I like to harp on the importance of having someone “with a different last name” around the table at meetings.

It’s important for family meetings to run well, and so having a facilitator who is not a family member is the best way to go.

Someone from the family office could be well placed to handle such a role.



Multi-Family Office Opportunity

For large single-family offices (SFO) there’s really no excuse for not doing the important work of involving the family and preparing the rising generation.

For multi-family offices, (MFO) the idea of offering assistance with family meetings is an opportunity to differentiate their services from those who are strictly investment managers for high-end clients.



Check Before you Sign

This is not a new idea, of course.  Many firms tout their assistance with family matters on their websites and in their pitches to potential family clients.

There is, however, a huge variation in the service levels that different firms out there can offer their clients in this area, so if part of the reason you are looking into an MFO is for help with family dynamics, be sure to ask LOTS of questions first!


Family Business Meeting Advice

Calm, Clear, and Connected

Each week in this space, I talk about things that affect the world of family business and family wealth, especially for families who are planning for a successful transition to the next generation.

This week’s subject is family meetings and three ways to assess them after the fact.

My premise is that you should strive for “calm, clear, and connected” meetings.

Let’s take them one at a time.



Keep Calm and Carry On

I’ve written a couple of blogs on the subject of calm, including Calm is Contagious earlier this year, and Calm-fident Advice for your Family in 2016.

When a family can meet calmly and discuss important matters while everyone remains composed, the results are usually much more satisfying than when voices are raised in anger.

It is normal for some contentious subjects to arise, on occasion, where things get a bit louder and more animated.

When the loud and angry meetings outnumber the calm ones, it’s usually not a good sign.

Ideally, there can at least be some calm parts of each meeting where the family can truly benefit from everyone’s best thinking and ideas.


birds flying in a V-shaped form

My Kingdom for Some Clarity

Another subject that I talk about regularly is clarity and the need for things to be clear.

Most people think that they have a clear picture of things in their own head, and that’s probably a good thing.

When we talk about a family though, it’s also important for everyone to have the same clear picture, and that’s very rarely the case.

There are many valid reasons why different people have different pictures of what they believe to be the reality.

Problems will arise when people who are working together to make decisions about important matters don’t have a common understanding of what they’re dealing with.

And a huge underlying issue here is that people often simply assume that their view is not only correct, but also that the others share their view.

One of the benefits of having an outside person present at family meetings is that this person can ask the “stupid questions” that the others would likely be afraid to ask, because they don’t want to risk appearing ignorant.

Of course, this presupposes that you can find an outsider who is prepared to act this way in the interest of clarity for the family.

I laid out some of the questions that you might ask in I Can See Clearly Now in 2016.



Connected: The State of the Relationships

The third element that I think is important for family meetings is connection.  I realize that this one may seem a bit less obvious to some, but please stay with me here.

Families work best when everyone is on the same page and everyone has an opportunity to be heard.

When I facilitate family meetings a big part of my role is to ensure that each person has the opportunity to speak and contribute.

You may wonder about my choice of the word “connected” here, and I guess I must confess that part of the reason I chose it is that “calm, clear and connected” evokes the old “cool, calm and collected” expression most of you are probably familiar with.

But the connection angle also stems from my understanding of the importance of family systems theory.


Family meeting

Interdependent Parts of a System

The members of a family are all interdependent parts of the family system.  I actually try to focus more on the relationships between the people than I do on the people themselves.

I try to notice all the non-verbal cues that I can when sister speaks to brother and son speaks to mother, and so on.

When everyone relates well with everyone else, meetings are more productive and the decisions that are made are more likely to stick.



Recap: Calm, Clear and Connected

No meeting is ever perfect. In fact, the focus shouldn’t be on any single meeting, but on having a series of regular meetings.

Try to get better from one meeting to the next, as the process evolves.

More calm is generally better than less calm.

More clarity, even if it takes a bit longer to make sure everyone understands things the same way, is better than less.

And when everyone actually connects with everyone else in meaningful ways, that’s ideal.

Think back to your last family meeting.  How did you do? Where can you improve?