What I’ve found interesting and counterintuitive in my research of generational families is that non-contributing family members actually play an important role in the success of a family business and the preservation of family wealth.
Family wealth is destroyed by a break down in communication and relationships, not poor business decisions.
Family members outside of the family business or main financial engine of the enterprise still require a clear understanding of their role as a fiduciary, director, shareholder and family member.
Non-contributors (for lack of a better phrase) who are still shareholders, need to take responsibility for knowing how to read financial statements, allocate capital and steward wealth.
Introducing family governance structures acts as guard rails around family wealth, facilitating robust discussions and ensuring all family members are aligned around a united vision - irrespective of the specific role they play in its pursuit.
Generational wealth isn’t that hard to keep, if you do the work…
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