Succession in family businesses: how to plan
Most family businesses do not survive into the third generation — often for lack of succession planning. Anticipating the transition protects both the business and the family.
Why plan for succession
The absence of clear rules on who takes over, how and when tends to give rise to disputes that paralyze the company at its most delicate moment. Planning organizes this transition during the founders' lifetime, with predictability.
Available instruments
- A family holding to concentrate and manage the assets;
- A shareholders' agreement with rules on entry, exit and decision-making;
- Gifting of quotas with reservation of usufruct;
- Definition of governance and criteria for management.
Succession is not just inheritance
Beyond transferring the assets, succession involves preparing the management: the heir is not always the manager. Separating ownership from administration is often the key to continuity.
Frequently asked questions
When should succession planning begin?
Ideally early, while the founders are still at the helm and aligned. The sooner it starts, the more options and the fewer conflicts.
Does succession planning avoid probate?
It can significantly reduce the cost and time by organizing the transfer during one's lifetime. The effect depends on how it is structured and on each specific situation.
Need guidance on this topic?
This article is informational. For guidance on your specific case, talk to our team.