Common Succession Scenarios
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Building a Family Enterprise
Family enterprises are the life-blood of the Canadian economy. Family Enterprises employ 6 million+ people, contribute over 60% to Canada’s GDP and give $1.5+ billion to charity. With more than 800,000 family enterprises across Canada, there’s a huge need for experienced and expert advise from professionals who understand the dynamics of family enterprises. The family enterprise is like no other business and have so many sensitivities to consider.
Family enterprises need to consider equalization strategies for family members that choose a career in another direction yet parents want to include them in some ways. How do look after a child who has lost his/her way and is not emotionally equipped to look after themselves, let alone join the family business? How do you address succession strategies when so much of the future is at stake? How do you deal with spouses that are brought into the business and then the relationship dissolves? How do you determine how and when someone is able to ‘cash out’ of the family business when business is suffering or booming? How do you address a family member who is not pulling his/her weight within the family enterprise? How do you deal with succession strategies and tax planning for the business?
How do you address all these dynamics at play and still attempt to sit down together at Thanksgiving dinner? To say that this is complex and highly sensitive is an understatement. To manage the complicated affairs of this organization, you need to be one part financial advisor and two parts psychiatrist. It has all the makings of the most dramatic reality television show imaginable.
To handle this spirited corporation you need to assemble, not only a team of legal and accounting experts but also handle it with the delicacy, objectivity and sensitivity that is required.