This article resonates well with me as there is a lot written about Family Charters and Family Constitutions but these can become commoditised by advisers and once completed I hear lots of stories about how they have been filed away and not referred to since.
Obviously, every family is different and to that extent, there approach should be too, but there need to be ways to help families engage, communicate, determine roles and actually make decisions. Clear decision making and direction at the helm is crucial the for the long term sustainability of the family firm.
To that extent, developing a more realistic code of conduct to help with any problems might make sense, especially where there is less of an appetite (and often budget) to complete a full blown family constitution journey.
Irrespective of the route taken, each and every family needs something in place to help address challenging issues that will manifest themselves at some stage, potentially a key event in the life of the family (marriage, death, divorce) or when it comes to discussing the challenges around succession.
Every family business needs a code of conduct to manage conflict. In theory, the ideal approach is to set up a constitution. However, that’s easier said than done. The problem with constitutions is they’re time-consuming and everyone has to be consulted. They are not enforceable in law but they can get very legalistic.