"Get the proper governance structure in place and you are well positioned to achieve commercial success and strong, positive family relationships."
Governance is an important issue in any business. Add in family relationships and the importance of having sensible governance structures in place becomes crucial to the smooth running of the business and the fostering of healthy, productive and rewarding family relationships.
In order to ensure that the governance procedures reflect the needs of the business it is important to spend time finding out what each family and non family member feels in terms of the focus for the business and their individual expectations.
We can guide you through this process, providing support in addressing the key issues and also providing project management skills to help you achieve your objectives.
Our unique Family Agreement has been developed by our family business team to meet the needs of our family business clients.
The Agreement assists those involved in the running of the family business by setting out in one document how their family business operates.
This reduces the risk of a dispute arising and, in the event that it does, it ensures that a procedure is in place to allow the sensible resolution of the dispute in a manner which minimises the upset for individuals and disruption for the business.
If your family feels that they would benefit from having a Family Charter, we look at this as part of the preparation of the Family Agreement. We believe that the Family Charter and the Family Agreement work best when they have been considered together.
Each family business is different and the essential elements of the Family Agreement can be tailored to suit the needs of each business.
"Take your time, discuss with the whole family and make it count"
We encourage families to engage all family members in the process of preparing a Family Agreement from the start of the process, to ensure that all family members have had their say and believe in and are committed to the agreement. We recognise that the family are likely to need support throughout the process and that the process is likely to take some time to complete.
"A living, breathing document"
The support of all family members will mean that the Family Agreement will be an invaluable tool for the business.
We understand that things change as time moves on and therefore we recommend reviewing your Family Agreement regularly.
They understood how to balance the need to deliver a result with the need to keep family members on board.
Each family member will have a differing role in the family and in the business, and our experience has shown us that tensions can arise when viewpoints differ on each person's role.
Family Charters set out the principles by which the family operates the business.
The task of preparing a Family Charter is in itself an invaluable exercise for a family because it enables the parties to share their views on the roles each party plays and also the essential values underpinning the running of the business. Any difference in views will be flushed out at this stage and can be discussed in a constructive manner in a controlled environment.
We can advise on the form of the Family Charter and its relationship with other family documents. Perhaps more importantly, we can support you in the process of discussing the Family Charter as a family.
It is always worth considering the best way to structure your family business to help preserve long term ownership where possible and appropriate. Trusts remain a popular method of holding shares in family businesses, although there are now potentially significant tax charges in setting up and holding shares and other assets in a trust structure. Other options our family business clients consider are Family Owned Companies and Limited Liability Partnerships. Family Investment Companies are an increasingly popular method of structuring family assets (perhaps excluding the trading business) for succession and tax planning purposes
Our tax team is experienced in helping family owned businesses find the right trust structure.
As your family business develops, it is sometimes necessary to review your corporate structure, to ensure that it works for the business.
We have experience in helping family-owned businesses choose the right corporate structure. Our Family business team members are drawn from a number of practice areas and we draw on the breadth of this knowledge to find the right reorganisation solution. This could mean streamlining your corporate structure, taking advantage of tax efficiencies or finding a corporate structure which better suits your business model.
Family businesses are often owned, managed and employ a range of family and non-family members.
Share options are a useful way of introducing both family and non-family members to the ownership of the business. They can also be useful to incentivise employees.
We will help you choose the most appropriate form of share option and consider how they can be tailored to take into account: