GOVERNANCE & POLICY CREATION

As family businesses grow and evolve into greater complexity reaching consensus on decisions becomes more complicated.

• How will decisions be made? Who participates? Does everyone have voice and a vote?
• Which part of the family enterprise will govern the decision – family, business leaders or owners?
• What if we can’t reach consensus? How will be break an deadlock?

Many families initially have low interest in creating formal policies. Families may not embrace the benefits and it typically gets put off until the family starts to experience issues. We like to think of today’s policies being put in place to solve tomorrow’s problems. They are an investment in the future and the next generation.

Forming policies and a governance structure starts by creating fair process. When people feel heard and part of the development process it creates greater buy in. 

Common policy areas: 

• Family employment: entry criteria, performance evaluation, promotions
• Compensation including perks and benefits  
• Code of conduct and communication agreement 
• Onboard new family members 
• Issue resolution