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24
Aspects of Land
Spring / Summer 2019
SUCCESSION PLANNING
E
states can be in families
for many generations, but
only if you work at passing
on wealth successfully.
Clive Beer, of Savills
Professional Services,
and Matthew Fleming, of
family office Stonehage Fleming, discuss
the art of getting succession right.
What is the most important factor
in getting family succession right?
Matthew:
There are two factors, really,
having an agreed purpose and good
leadership. The greatest threat to family
wealth isn’t bad investment decisions
or changing tax structure – there are
outstanding advisors to help with those
– the real threat is the family itself. But if
the family has a strong shared purpose,
which could be passing on wealth, or being
custodians of the family property, then
everything else flows from that. It’s an
extremely important conversation to have.
Clive:
And for me, the most important
thing is communication. It’s essential to
understand each other’s point of view, you
might not share it, but if you can understand
it, you’ve at least reached a starting point.
And what does good
family leadership look like?
Matthew:
I believe a family’s capital has
four pillars: financial, cultural, social
and intellectual and they all need strong
leadership. However, it’s very rare that
one person can lead across all four
areas. Entrepreneurs can often have a
very dictatorial style of leadership, for
example, and that’s not going to keep
the family together. A good leader will
harness the talent in the rest of the family
and establish a strong purpose for the
family that will guide every decision,
but establishing is very different from
imposing. The common denominator
for all successful families is definitely an
ability to communicate.
What happens if a family
doesn’t communicate well?
Clive:
Hopefully, they get a third party,
such as myself or Matthew involved. We
can have discussions with family members
that they might feel uncomfortable having
with each other. We can ask questions
that nobody else will ask, that can lead
to a greater understanding. It’s about
creating the alchemy. We’re disposable,
while family ties are there forever.
Matthew:
Although families don’t have to
be locked against each other to benefit
from a third party. There can be families
filled with love who need guidance with
communicating. For example, I was
working with one family recently, where
the father was an entrepreneur and his
wife had supported him throughout his
career, nearly losing their house three
times. It turned out the biggest issue was
that the three daughters now wanted the
parents to enjoy their wealth more and to
worry about them and their futures less,
while the father was still concentrating
on building up a business for his children
to inherit. We ended up agreeing that the
parents would step back and take at least
two holidays a year.
“The greatest threat to
family wealth isn’t bad
investment decisions
– the real threat is
the family itself ”