What is Family Governance

Governance is a common term in the world of big companies, referring to the system and processes by which companies are overseen and controlled. So what place does it have in the family context.

My view is that all family have some form of governance in place although it is usually unspoken - it’s just the way things are done. Who carves the roast at a family dinner, what age you could get your ears pierced or who was hosting Christmas are all examples from my own family growing up.

In most cases there’s no need to pay too much attention to these or write any of them down. However, if your family shares ownership of any assets - a holiday home, an investment portfolio or a family business perhaps - things can get more complicated.

Family governance, then, is how a family with shared assets makes decisions and communicates. It can take many forms, from holding regular family meetings to setting up a What’s App group to share news and updates. In larger or more complex situations it might include establishing a family committee or agreeing rules about who can work in the family business.

If you are part of a successful family enterprise, it’s likely you will already have some governance measures in place (although you might not call them this). If you’re comfortable that they are working well, everyone feels aligned and shares the same expectations then that’s great. However, if you are starting to see tell-tale signs of friction, or you are simply going through a lot of change, now may be a good time to take a step back and assess whether your approach needs a bit of fine tuning to ensure it remains fit for purpose.