The fact is family businesses get more complex over time. Each generation offers the potential for additional family members to be involved. What started as a simple partnership becomes an enterprise with several owners, decision makers, and managers. So, beyond the technical issues unique to family business succession - tax minimization, family trusts, and wealth management planning - the 'family' part makes the process even more unique.

Integrating family members into your succession plans will help you manage expectations, instil a sense of comfort and equity amongst your successors, settle potential conflicts before they become difficult to manage, and make informed decisions.

Let's start with communication. If you don't already, establish regular Family Business meetings with the family members who are directly involved with the day- to-day operation and management of your company. Use these meetings to build your succession plans.

You can deal with the issues around both management and ownership succession. Some examples include your timeline, grooming the successors, and how succession will be communicated to employees and externally. You'll want to outline your changing role and how management responsibility and ownership will change hands. You should also review compensation, shareholder agreements, and financial details. For example, will ownership transfer gradually or all at once? How will the shares be acquired?

As part of the discussions, you should create and document a set of business rules that everyone agrees upon. These rules can cover conflict resolution, criteria for hiring/including family members in the business, and performance reviews, to name a few. Once ownership transfers hands, the next generation has something to refer to and modify as and when needed.

Your aim is to create the following plans, so you are ready to engage professional advice to solidify the deal:

• A shareholders agreement
• A set of family business rules
• A business plan prepared by the successors
• A grooming plan for each of your successors

In addition to your Family Business meetings, you might also consider establishing regular Family Council meetings. These would involve a broader group: family members, who might be impacted by the business, but are not actually involved in day-to-day operations. These will help you keep family members informed and engaged. And, as they are not directly involved, the family council might be valuable to provide feedback and advice.

"While the majority of family business owners would like to see their business transferred to the next generation, it is estimated that 70% will not survive into the second generation and 90% will not make it to the third generation."
Family Firm Institute, ffi.org