Small Business

All in favor of our future? Navigating family succession

Ann: Welcome back to Building More Than Business. I'm Ann Lucchesi, a CFP and Senior Director at First Citizens Wealth. Joined by my co-host Nerre Shuriah, a certified business exit consultant, who heads up our wealth and business planning capabilities. Today, we're talking about the very first step in preparing your family to take the reins—something known as the family meeting.

Nerre: If you've ever tried to get siblings, parents and in-laws on the same page, you know it can feel like controlled chaos. That's why we've asked April Zee to join us. April and I have worked together for a really long time, and I'm so thrilled to have her here as our first guest. April is a senior wealth planning strategist here at First Citizens Wealth. She's uniquely qualified to speak to this topic because of her combined background in wealth planning and psychology. April, welcome to Building More Than Business. Can you tell us a little more about your background?

April: Thanks for having me, Nerre and Ann. I'm excited to join you and talk about such an important step in planning. My training and experience—it's a blend of financial strategy and psychology because I've been doing wealth planning for over 23 years, and I also have a doctorate level of education in psychology. So when it comes to family meetings, not only am I focused on crunching all those numbers, it's also just as important to address the emotions and dynamics. It's the human side of wealth.

Ann: Such a unique blend of expertise and experience and bringing in that psychological aspect within the family meeting, April. Before we dig into the details around the family meeting, can you kind of set the stakes for us?

April: They're focused on having thoughtful and structured conversations, and the idea is to have multiple generations work through succession planning and all the family dynamics that comes with that transition. Even the most financially savvy families can fall apart if the emotional groundwork isn't laid first.

So I found that a well-facilitated meeting isn't just about who's getting what in an exit. It's about keeping the family harmony through the transition and for multiple generations.

So when we think about the family meeting, there's three main purposes. First, to encourage effective communication. Second, to educate heirs about financial literacy and family leadership roles. And lastly, to provide a forum for making collective decisions. And out of those three, I would say the crux is communication.

Business owners have often assumed they've communicated their wishes clearly, but most family members are operating on assumptions or side conversations with the siblings, and that's where the misunderstandings can begin to fester. And you want to keep in mind, the goal here is we're not trying to change the family dynamics. We want to create structure and safety and purpose for the family to move the conversation forward productively.

Nerre: Thanks for that summary, April. The family meeting is really intriguing. These conversations can carry decades of emotional weight, especially in family and legacy businesses. And when the family avoids having those meetings, it really creates more long-term risk. Founders may avoid meetings out of fear of stirring conflict or just not being able to address it as a whole. That's where advisors come in. They can play a neutralizing role and act as a buffer that creates structure and reduces defensiveness. April, can you elaborate a little bit more on that?

April: Yeah. Even before you start the family meeting, it's imperative to create a safe zone, which is established through ground rules, and then shared purpose, which is created through a family mission statement. So within the family meetings, I've seen typical emotions in the room ranging from uncertainty, hope, fear of losing control and a desire to be heard or validated.

So as a facilitator, it's my role to help navigate all these emotions and expectations to reach the family's collective goal. So even before the meeting begins, a family has an agreed-upon ground rules. Those rules can be, you know, as simple as no interrupting, every voice matters and that everyone attending is really committed to the process and is present in the moment. To help guide that process, we always start off with pre-meeting questionnaires and worksheets that are kept intentionally anonymous, and this helps to surface those unspoken concerns, goals and level-set expectations. We want to capture what everyone's thinking but might not have the courage to say it out loud. So it's an opportunity for everyone to have a voice and be heard.

And when this is done right, these meetings build trust and give family members a shared language to talk about sensitive issues openly, and most importantly, a forum to communicate and work towards their goals. And those goals are anchored in the family mission statement. The mission statement's created by the whole family. It communicates the family's core values, it guides their culture, develops purpose and is memorialized for future generations. Check out the episode summary for links to worksheets to help you determine your values and mission statement.

Ann: That is just such good groundwork on how we think about these family meetings. You know, business owners, they often come to a family meeting thinking it's like they're running a business meeting, right? "We're gonna have an agenda, we're gonna stick to it, we're gonna get everyone on track and we're gonna get to the end of it." And this really breaks down the trust that you need to have in these family meetings. So the goal is not about selling the transition plan, it's really about listening and building that alignment within the family.

Families really need space for emotional complexity. You know, doing that pre-work is so important because it really sets the stage for creating that safe space where people can communicate with one another.

So maybe now, as we shift a little bit and talk about navigating roles and readiness and such, once a family commits to talking about the future, the natural next question becomes, "Who's stepping in, when are they stepping in, how is that gonna look?" You know, these conversations are just loaded with assumptions. Someone may expect to lead, while someone else quietly questions if they're even staying. April, I'm sure you've seen this happen in a lot of families.

April: Deciding who and when can be challenging decisions for owners to make. Not all business owners are ready to transition for multiple reasons, and I found the main reason is typically rooted in fear—the fear of not being ready to let go. A lot of times their whole identity is tied to the business. And this fear can lead to resistance that manifests into silence, deflection or delay.

I recall working with a family where the father and son had different visions for the future of the business. The son wanted to bring in new technology products and drive growth and longevity for the business. This is his future and his livelihood, so he wanted to make sure it's continued to grow. However, the father wanted to keep it as is, and that misalignment unfortunately stalled any decisions for them to prepare for the succession of the business.

Another lack of action I've seen is when an owner felt guilty for not treating his children fairly, since one was in the business and the other was not. He intentionally was not making any decisions to avoid hurting the child that was not in the business. In both these instances, a delay in planning could have significant family and financial consequences. You want to transition to business on your own terms, not because you have to.

Ann: Yeah, we've seen families stay stuck for years because no one wants to voice discomfort. When someone finally does, I think things start moving along the path, right, Nerre?

Nerre: Exactly. So April, we've talked about the importance of a family mission statement, but can you give an example of one, or what are the steps to create one?

April: So this is the fun part of family meetings is we get to see the family all working together. When guiding the family to work towards developing their mission statement, the family should strive for it to be who they are at their core. It's really like the family roadmap.

So when creating a family mission statement, I always like to start out with discovering each individual's wealth values. And these wealth values are the extension of your personal values that shape your relations with money. Some examples could include the value of hard work, family loyalty, generosity, spirituality. They take these shared wealth values along with their wealth goals to build the mission statement. You can begin to create your mission statement by using this three-sentence formula. The first sentence begins with the word "To" and then the family fills in something that requires an effort on the part of each and every family member. You want it to be inspirational in nature and future-reaching.

And then the second sentence begins with "In such a way." This is the quality of your action, and this is where you would place the family's wealth values here. And then the final sentence begins with "So that." And you want this to capture the results of your action. What do you want to come out of all of this? And this is where the family puts your wealth goals. And if you put this all together, a finished product could look something like, "To realize our dreams and goals as a family and as an individual in such a way that stretches our intellect, gives back to the community and tightens our family bond so that our legacy will continue to grow."

And when a family has finished this mission statement, there's a real sense of pride of what they've accomplished, and it's so exciting as a facilitator to see all of that come together. I recall working with a family and we memorialized their mission statement on a little lucite plaque, and it was such a wonderful way for the future generations who might not have had a chance to hear firsthand what that generation's collective vision was, but now they can read it and allow for those wealth values to carry on.

Nerre: So one family meeting isn't going to answer every question, right? If we do this exercise and they complete their mission statement, it's not one and done, but it should create a path forward. We often tell clients, "Don't aim for resolution in one sitting." The goal is to open the door. You know, this is the first step in moving forward, and it's a chance for expectations to be shared out loud and be clear. Otherwise, assumptions fill the gaps—and usually those are negative assumptions.

Ann: So well put, Nerre. If the human side isn't addressed, I think any strategy will fall flat. You know, I kind of recall when I was younger, it was a family friend of ours where he really had opted in his last year of life to transition the entire business to the oldest son—and did this in what I would call a vacuum, right? Didn't talk to the family about it, didn't communicate the why of it. And to this day, three kids in the family don't talk to the other three kids. And I just think—I can't believe that's the legacy he wanted to leave. And it just shows you how important it is to address these things. I think the why behind the decisions really matter.

April: Absolutely, Ann. Without next steps or some kind of timeline, people could walk away unsure of "what did we just agree to?" or what's expected of them. They need a plan or a roadmap. So when a family gets off track, they can hold each other accountable and they can refer back to that shared vision.

Also, similar to the pre-meeting work, assigning post-meeting work is also just as helpful. Even if the next step is, "Let's revisit this in 60 days," naming it gives structure and reduces anxiety. Additionally, I found helpful is a written summary or a recap so that no one feels misrepresented or misunderstood, and everyone has clarity towards the shared goals.

Ann: So I think now we'll shift to one of our recurring themes, which is "What would you do differently?" Family communication can be so complicated, and we just seem to often fall back into the roles we played when we were young. The dynamics just get complicated, and when families don't talk early and often, small misunderstandings can grow into big divides. April, what's the one thing you've seen families do that made a difference, and the one thing you wish they had done differently?

April: I think what made a difference is when all of the family members are truly committed to the process and they're present and they're ready to roll up their sleeves and get to work together, as well as creating a space for open communication and feeling safe to share and express their emotions. I recall we had a family meeting where each family member shared one fear and one hope, and it really set a completely different tone. When you can get to that point in a family meeting where everyone has a voice and can be vulnerable, it's so powerful and you know they're on the right track to success.

And then, Ann, I've seen missteps where, you know, the family treats the family meeting like a performance review—for example, a parent listing out everyone's weaknesses. And that's just going to put everyone on the defensive or shut down. We're trying to create a level playing field within the family meeting and not slide back into the dysfunctional roles.

Another challenge is to listen without fixing. You know, business owners, they're used to being in control, making decisions, and that's one of the reasons why they're so successful. The family meeting provides a platform for all family members and an opportunity to share their opinions in a judgment-free environment. Again, bringing it back to putting everyone on equal footing sets up the family for success.

Nerre: An example that I had along those same lines, April, is I once worked with a successor who wasn't ready for the financial responsibility that came with the business. He made a lot of personal withdrawals without really understanding the operational impact. I think he thought the business was his personal checking account. Uncovering skills, weaknesses and setting growth expectations earlier really could have helped him grow into the role with more confidence and financial literacy and discretion around his choices. Simply naming roles could have eased uncertainty and helped him in the next generation.

April: So to summarize, the family meetings serve as establishing the foundation. Sometimes it's better to start with a non-emotionally charged topic like, "What are we doing for our annual charitable giving?" or "Where are we going to go for our multigenerational vacation?" It helps a family get comfortable with the process.

If your family meeting accomplished the three purposes we laid out in the beginning of this discussion, then you're on the right track. And as a reminder, those are encouraging effective communication, educating heirs about financial literacy, family values and leadership requirements, and providing a forum to make collaborative decisions. Second, building that family mission statement with the family's wealth, values and goals. These concrete steps are critical to ensure the family is productive.

Ann: If you're running a family business, the first family meeting is often the hardest and most powerful. These meetings aren't about having all the answers. They're about making space for honest questions.

Nerre: And the sooner you have these conversations, the more room you have to build trust and alignment before the need for decisions becomes too urgent. A good plan doesn't just protect your business, it helps your family move forward together.

Ann: Well, this has been really great. Thank you so much, April. Thank you, Nerre, and thanks for tuning in. Subscribe on Apple Podcasts, Spotify or YouTube Music. And if today's episode resonated with you, please share it with someone who might need to hear it. See you soon.

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