Family Governance and Protocols
The effective management of relationships within a family-run business is particularly important because family relations are often more complex, involving additional factors of tension and longer-term concerns than are usually found in other types of businesses.
The decision to establish a family protocol, and its review, updating and implementation monitoring, has the great advantage of stabilising relationships by bringing predictability and comfort to the parties, thus reducing the likelihood of problems occurring and promoting greater longevity of the family business.
In addition to issues specific to family businesses, such as family members’ employment in the company (and their remuneration), the matters usually dealt with in shareholders’ agreements call for a distinct approach, including with respect to governance systems, the transfer of shares, succession, issues relating to remuneration for work and company capital, or any other matter.
General corporate governance issues have their own unique dynamics, which entail very specific considerations in the context of a family-controlled organisation.
Know-how
- drafting of family protocols, including overseeing the entire process from the initial gathering of opinions, suggested solutions and family discussions through to the preparation of draft texts to be adopted
- partial or full review of existing family protocols in light of new circumstances or developments in the family or the business, as well as to address any operational constraints that may be identified
- monitoring the implementation of family protocols and assisting with the practical aspects of this implementation
- design of family business bodies and their respective powers, including rules of operation and interaction with governing bodies
- definition of decision-making models and management of deadlocks
- drafting of policies on family employment, succession, and dividend distribution, among other governance matters.
- monitoring of practical implementation and governance formalities from a risk prevention standpoint
- analysis, configuration or review of specific defined aspects of family business governance
- provision of training in governance and associated risks for members of governing bodies and/or family members holding relevant positions