Family businesses are an important part of the Scottish business community and of our client base. We have long experience of acting for families and their commercial financial interests often through several generations, and are well placed as a firm to provide the full range of services required by both the family company and those individuals within families who work in and/or own it.
All businesses of course rely to some extent on the relationship among those who own them and manage them: do they have a common view as to the company's direction; how are decisions made; what do the owners' ownership horizons look like - is there an exit plan? In many cases these questions are easier in a family - there is a sense in which nature and nurture brings up members of families with shared values and a common approach to business. However, there are also issues within families, around expectation and fair access to the family's wealth and assets that result in specific and different pressures for the family business and for the family that owns it. What rights do family members have to manage; how is access to the value of the family business provided to those that need it; what happens in terms of succession; how is the family's non-business wealth protected from business risk and indeed the business from exposure to "family risk"?
We can help with these issues. We are frequently involved in the re-organisation of family businesses, splitting them to allow succession planning on a fair basis, while allowing different parts of the business to be managed by the individual who does so most effectively. We regularly address succession more generally, with our Corporate and Private Client Teams working together to ensure that fairness is achieved and achieved in a tax efficient manner, recognising the expectations of family members many of whom are known to us as individuals. We have specific expertise in the impact of separation and divorce on the family business and the rights (or otherwise) of partners and spouses to seek a share of family business assets in those circumstances.
It can be useful, and help in avoiding issues for family members and the business, to be regulated by the means of a Family Charter (a non-contractual set of family rules for participation in and interaction with the family business). This is a useful tool, even if all it does is act as a forum for active discussion of the way in which the family will interact in relation to the business. In many cases that openness about what people want and need from the family business is enough.
The family business is alive and well and families will continue to have great ideas and want to exploit them together. They should feel encouraged to do so.