Strategic advice

Our expertise in working with families across their personal financial and business interests enables us to offer clients rounded perspectives as they look to tackle the challenges of managing substantial private capital and family dynamics.

Strategic Advice

A family’s relationship with its businesses and financial interests can be complex and the distinction between ownership and management can sometimes become blurred.

We work to ensure that structure and strategy align to deliver in the best interests of your family over the long term, covering considered advice on:

  • family governance
  • family constitutions
  • setting up single family offices
  • next generation preparation, and
  • succession planning

Family governance and constitutions

Effective family governance can prevent problems before they even arise.

Properly articulated and administered, family governance covering a family constitution, family council (including written terms of reference) and e.g. investment meetings help:

  • develop the roles, rights and responsibilities of various family stakeholders
  • encourage family members, employees, and founders to act responsibly toward the business and the family
  • regulate appropriate family and founder/owner involvement in business discussions
  • help future proof your business or the protection of your capital

There is no template for ‘good governance’ and what will work for one family may not work for another. It is also a continual discussion as family offices, family businesses and families themselves evolve.

Drawing on our deep understanding of family offices, family owned businesses and a client’s own family we are able to help institute and administer family governance arrangements, building structures that are strong but adaptable.

Setting up a family office

Some families reach a point where effectively managing their accumulated capital may be best served through setting up a single family office.

Smith & Williamson is experienced in guiding the decision-makers of substantial private capital, whether by inheritance, business growth or exit, as to their options and the benefits and challenges of setting up a family office.

The efficient and professional management of wealth for the benefit of the whole family is often a major driver.

Properly established, a single family office can also firmly institute the purpose and processes required to protect and enhance family businesses, income and capital for future generations.

These processes and discussions are key to success of a single family office. They ensure that wherever they are located, or whatever stage of life they are at, family members understand the purpose and direction of the family office and what it can, and cannot, do for them.

We help you answer these critical questions to establish an effective family office:

  1. What is the long term purpose and vision of the family office?
  2. What roles should each family member play?
  3. What governance mechanisms need to be in place to ensure long term effectiveness and delivery against objectives?
  4. How will you evaluate success and adapt if needed?
  5. How can the next generation engage with the family office and the responsibilities that they may inherit?

Next generation preparation

How and when to actively involve the next generation can be a difficult decision.

To effectively manage the responsibilities they inherit, we advocate investing in financial literacy and engagement in family businesses and family offices early on. To help address the needs of individual family members as well as the whole, we can assist a family’s younger generations through education in financial matters – both personal and business.

As an independent partnership, predicated on a collegiate, inclusive culture, we are adept at ensuring full co-ordination with all those involved in a family’s affairs.

A client will have one lead partner as a single point of contact across all areas we are engaged in. Different generations will often be represented by other partners, who may be more in tune with their particular requirements. This collaborative ethos has often engendered better engagement and understanding between generations to the benefit of the entire family.

How we can help

  • Family constitutions: explaining the mission values and purpose of the family or family office
  • Terms of reference for family meetings: providing a structured framework to conduct meetings
  • Council of Elders: Retaining for the long-term benefit of the family, the wisdom of its most experienced members
  • Junior boards: advising on establishing this dynamic format for next generation preparation
  • Philanthropy and impact investing: helping the family to help others, whilst receiving deep and educational benefits
  • Training and education programmes: practical bespoke programmes for family members
  • Initiated mentoring: A key component of education and preparation with family members or external advisers
  • Family retreats: planned with understanding and sensitivity to a family’s character
  • Private family websites: a potentially invaluable tool for enhancing a sense of family history, identity and cohesion
  • Introductions to other families: Arranging an exchange of experiences with those in a similar situation can be invaluable

Succession planning

Passing on significant private capital in a considered manner is a critical part of any family’s financial strategy.

To plan for succession, owners and inheritors need a clear vision of what is trying to be achieved and the means to bring it about.

Families with strong governance structures or constitutions are better placed to tackle difficult decisions or unexpected changes and ultimately protect their assets.

With the right structure and governance in place, you and your family can make important decisions on the destination of your family’s wealth and establish the optimal vehicles to achieve your objectives.

Planning should begin early, whether you’re passing on capital to future generations, or considering a philanthropic endowment. Aside from structuring, consideration should be given to managing expectations and educating the next generation to understand their responsibilities.

How we can help

  • Structuring: We help create bespoke structures outlining and codifying the rights and responsibilities of family office stakeholders.
  • Tax and estate planning: Guiding you through multi-jurisdictional estate planning and tax issues, including the use of appropriate structures.
  • Legal issues: Keeping the family abreast of the financial aspects of changes in family law, such as prenuptial agreements or divorce.
  • Philanthropy: Helping you develop a suitable approach to charitable patronage and endowments to ensure that your family’s investments are impactful.
  • Education: We strongly advocate investing in financial literacy and engagement in family businesses. We assist the next generation with education programmes to ensure they can live with, and act as, the future guardians of a financial legacy.

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