Aligning passions, interests and careers

The NextGen are driven by a strong desire to prove their own worth. And they want to excel in the areas that matter to them - whether it is their career path or how they deploy their wealth.
However, they often find it challenging to match their values with their professional or investment plans.

^{Source: Global Next Generation Report, Results of a 2018 survey of over 200 Next Generation leaders}

Finding your path

Many Next Generation members find themselves at a crossroads when embarking on a career. They often need to decide whether, and to what extent, they should get involved in the family business. This may be a difficult trade-off between their personal development and continuing with the family tradition. If not discussed and managed effectively, this decision process could have consequences for the family legacy.

What to consider before stepping away from the family business

Bernard Fung, Head Wealth Planning Services, Asia Pacific at Credit Suisse, recommends that the NextGen ask themselves the following questions before they go “off-piste” from their family business.

• Who will look after my interests in the family business?
• What irreducible role can my family reasonably expect me to have?
• When will I return?
• Where will I obtain capital in future?
• Why am I really doing this?
• How will my departure impact my family’s legacy?

The Global NextGen Report case study — Preserving the family business

The first generation built up a very successful business serving “fundamental” consumer needs (e.g. food or clothing). The family members agreed that the legacy they want to preserve is for as many future generations as possible to be involved in their business and hopefully continue to be known as a business family, pursuing innovations in that area. The business part of the family’s material wealth was placed in a trust with a clear governance structure, including a plan setting out how successors are nurtured, identified and rewarded, as well as provisions for what would happen if no suitable family members were identified in one particular generation. All other parts of the family wealth were deemed unnecessary for the purpose of the legacy. These assets were therefore distributed to various family members to create their own structures within their respective branches of the family, while the remainder was placed in a philanthropic foundation that would improve education in their country. Download the report if you want to see more case studies.

Prerequisites for a high-performing family business

With careful handling and planning, often with external help and assistance, families can strengthen communication and bridge the generation gap – whether it’s about wealth, succession, or family business ownership. A shared vision (and values), and clear governance and succession plans, are essential for the lasting success of family businesses.