by Nick Paterno, managing partner, McBrides Chartered Accountants
When the Duke and Duchess of Sussex indicated their desire to leave the family firm and forge their own brand earlier this week, there were many in the business world who recognised the perennial problems facing those involved in a family business who want to split.
Being a part of the ‘family firm’ brings with it a unique set of challenges as a result of the structure, culture and history of that family-owned business.
For some in the family, working within a business set up by their forefathers provides everything they need and more, while for others, working within the confines of the family firm can feel stifling, lead to a feeling of a lack of freedom and ultimately a desire to break away and do things in their own inimitable style.
There are many factors that can make working within the family firm feel stifling or wrong:
So what can you do if you want to change tack and set up on your own? Well, it’s often prudent to ask yourself a set of questions and to look at the answers to these in order to see if a future away from the family firm is prudent or even possible.
Firstly, you should ask
If you have answered yes to the above, then there’s a good chance, that you can collaboratively find a way out of the family firm and keep your familial relationships in good order. If, however, you have answered no to any of the above questions then you will need to work within the structure of the business to find a way to either stay and build a happier future, or make plans to make an exit that works for all.
Sometimes if you have grown up within the firm and it’s all you know, and all your forefathers know, it can be difficult to focus and separate your needs from those of your family, and it can also be hard for the family to see your needs as separate from their own. It’s important that everyone understands each others strengths and needs and the only way to gain this understanding is via communication. You may need to bring in the help of a professional mediator in order to smooth communication, or you may have a natural mediator within the family.
Once you have identified there is a problem, it’s essential to keep communicating, to meet regularly and to set shared goals. Taking advice from professionals, from your accountant and legal team is essential. The Institute of Family Business is a good resource too. The following points will help everyone move forward successfully.
It’s not always easy working alongside your relatives and if a family member is dead-set on leaving then there are ways of smoothing the path for them and for cementing things at the family firm so that everyone gets what they want and need. A proper exit plan is essential as is succession planning. If you’d like to know more, please do get in touch with our team of experts at www.mcbridesllp.com