The tricky thing about managing families is that members are prone to creating rules but issuing no rule book. The rules are unwritten, but you’re expected to know them. These rules that are often based on deep-seated values. And because these rules are never written down, they’re taught by a combination of modeled behaviors and reinforcing or corrective comments. Families may be able to get away without governance practices for a generation or two. Beyond that, this unwritten rule book begins to look different for each branch of the family, chipping away at and watering down the shared values that once felt like bedrock. That’s where governance comes in.
Governance is about creating a system designed to clarify and sustain family values and the rules that support them.
This is the third segment in our series about family culture. Our first piece outlined our premise that family connection and shared values are the greatest determinant of multi-generational continuity – and that achieving it requires identifying and nurturing your family culture. The second piece outlined the first step in the process of supporting your family culture: identifying and clarifying it. This third piece outlines the role of governance in a family.
In its most simple form, governance is made up of three elements:
- Family Constitution – document that identifies the vision, values and expectations for family members
- Family Meetings – gatherings where family members are invited to learn about things that are relevant to the family
- Family Council – subcommittee tasked with management and maintaining the family “rule book” – and often charged with supporting family members’ human and intellectual capital
Every family has their list of rules (written or not). Jamie’s extended family shares a piece of property that eight generations have enjoyed. Below are some of those unwritten rules. And as a side note, since these “rules” are not written, they are open to debate and interpretation:
- No Flashlights – Using a flashlight at night risks blowing your cover and exposing you as a friend and guest rather than a relative. One’s ability to navigate footpaths at night solely by feeling the contours of the path with their bare feet generates respect.
- Know the Roads – Family members who memorize the names and intersections of all the footpaths and roads crossing the property gain even more respect.
- Care for the property – And family members who efficiently wield a chainsaw or pair of loppers are celebrated as respected stewards of this property we love so much.
Why are these behaviors important? In the examples above, they are based on the underlying belief that to keep this cherished family property, it’s important to feel, learn, and appreciate the land’s contours, know the topography, its flora and fauna and how to care for all of it. These behaviors and the unwritten rules are based on “respect”, “appreciation” and “collaboration”, which are core family values.
These values also play out in other behaviors and traditions. When guests arrive, everyone is expected to help haul their gear to the house and help them get settled. Young family members learn at an early age how they are related to one another, learning the difference between a first and second cousin and another who is once removed. While foreign and even alienating to those who are not related by blood, this exercise helps family members recognize, respect and appreciate the multi-generational connections and the history we share. We collaborate on projects such as installing a solar array to reduce our costs and carbon footprint; we maintain the roads and paths; and we celebrate our connections and ability to collaborate when we gather, as we have for generations, and make music together.
In Jamie’s family, there is a council, and there are annual meetings. But there is no written Family Constitution. The culture of the shared property, instead, provides a tangible place to gather and a reminder of the vision and values that would otherwise be expressed in a constitution.
While not a complete expression of solid governance practices, this system works because there are traditions and expectations that fortify the culture and provide opportunities to revisit and affirm the values that support it.
As families expand and the broader culture continues to evolve outside the family culture, the more important it is to establish and maintain governance. And for families who operate businesses together, establishing strong working governance practices are essential.
Our next post will explore examples of how families fortify their culture by building in ways to teach and reinforce their shared values with activities and traditions.
Co-Authored by Jamie Forbes and Kelly Nowlin
Jamie Forbes is a member of the sixth generation in a family with a history steeped in shipping, transportation and communications dating from the 19th Century. He is the Founding Partner of Forbes Legacy Advisors, which specializes in helping families plan for and make generational transitions. Read his bio here.
Kelly Nowlin is a fifth generation family trustee of the Surdna Foundation – a 100-year-old family foundation – and is also the Founder and Principal of KDN Philanthropy Consulting, helping family foundations mark milestones, engage the next generation and realize both legacy and impact in their work. Click here for more info on Kelly.