The Family Alliance:
Focusing on the Family in
Family Enterprise Planning
Frederic J. Marx
www.hembar.com
T A B L E
O F
C O N T E N T S :
4
Executive Summary
4
The role and history of family enterprises in our economy
6
The special needs and problems of family groups
7
The Family Alliance
8
The goals and benefits of the Family Alliance
10
How the Family Alliance works
11
How the legal structure facilitates family group flexibility
and success
13
Other tools used in the Family Alliance
15
The keys to success: the right people and people skills
15
The results
16
In Conclusion
17
About the Author
The Family Alliance: Focusing on the Family in Family Enterprise Planning
Executive Summary
Despite increasingly complex challenges and changes for families, their businesses and
charitable enterprises, the overarching goal has remained the same. Each wants the
ability to survive and thrive for generations in an environment of daunting competition.
Planning for these needs has evolved as well. This paper shows how one planning
strategy, the Family Alliance,™ has successfully met the challenges and opportunities of
the multigenerational family enterprise. It marries the tools and techniques of continuity
planning with a uniquely flexible legal structure that centers on the family group, not any
particular family business. It establishes a “family coordinating entity” which supports a
variety of needs and activities, including succession planning and diversification of the
family into other strategic ventures, philanthropic interests and family office activities.
The Family Alliance structure supports multiple family enterprises operating under the
unified banner of the family group.
A strategic shift
First, some background. A growing number
of family groupsi have recently turned to a
more “client-centered” approach to
multigenerational planning, sometimes
referred to as “continuity planning.” This
strategy offers solutions tailored to fit the
unique needs of a family group and is
designed to last for generations by staying
centered on the broad goals of the family
group, both business and personal.
The Family Alliance structure supports
multiple family enterprises operating under
the unified banner of a family coordinating
entity. It marries the tools and techniques of
4
continuity planning with a uniquely flexible
legal structure that offers beneficial
accounting, tax, liability, privacy and
governance features for family enterprises.
This structure can also adapt over time to fit
a growing and changing group of family
businesses and charitable enterprises.
The role and history of family
enterprises in our economy
Effective planning strategies are important
not only for family groups and their
associated enterprises, but for the country
as a whole. The exact contribution of family
enterprises to the national economy is hard
to quantify, but various authorities have
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consistently concluded over the years that
they compose up to 90 percent of all
business enterprises.ii Others have
suggested that they account for as many as
78 percent of jobs created in the United
States and as much as 65 percent of wages
paid.iii Additionally, many family enterprises
donate substantial amounts to philanthropic
causes.iv
Of course, it is impossible to provide exact
numbers for these contributions, and the
hypothesized numbers depend on the
definition used for a “family enterprise.”
Definitions used in studies have ranged from
“businesses effectively controlled by a
family” to “businesses in which family
generations have direct involvement in
management and ownership, as well as
control.” The most conservative analysis
using a narrower definition, however, would
still suggest that such enterprises account
for at least 20 to 40 percent of United States
gross domestic product, 15 percent of the
workforce and 19 percent of new jobs.v
Furthermore, family enterprises are not just
small businesses. Families have created or
continue to run important companies for
generations, such as DuPont, Mars
Corporation, Ford Motor Company and
Firestone.vi
Recent studies also suggest that family
groups of all sizes may be “morphing” their
business enterprises over time in order to
perpetuate a family group legacy and avoid
the terminal fate that some family
businesses have suffered. A study done
more than 20 years ago of Illinois companies
over a 60-year period concluded that fewer
than half of family businesses survive the
transition to a second generation for more
than a few years, and only 13 percent of
family companies survived to the third
generation.vii A more recent study of
Canadian family businesses similarly
concluded that 70 percent of enterprises
do not make it to the second generation
and 90 percent end before the third.viii
These studies, however, ask the wrong
question. The question is not how many
family businesses reach the third generation.
Instead, it is more useful to ask,
How do family groups thrive over
multiple generations?
It is more useful because it is the FAMILY,
not any particular FAMILY BUSINESS, that is
the center.
When we ask about the ability of family
groups to thrive over multiple generations,
the perspective shifts dramatically, along with
the answers. To take the lead from Darwin,
those entities that are designed to best adapt
to changing environments will survive. This is
the purpose of the Family Alliance.
What allows family groups to thrive over
multiple generations? A very recent U.S.
study has concluded that sophisticated
contemporary family groups that have
survived over multiple generations as a
cohesive group controlled and focused their
efforts on not one but multiple businesses
(3.4 on average). They controlled an average
of 6.1 businesses in at least two different
industries over their family’s history.ix To sum
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The Family Alliance: Focusing on the Family in Family Enterprise Planning
Another role is work-related. Management,
staff, sales, compliance and accounting all
have different roles. Teamwork is key.
Constructive competition is an asset.
Imagine the dynamics of a business meeting
for 30 in one room to design a business
plan.
This approach to the family group represents
a practical adaptation to a globally
competitive era and an accelerating pace of
change. Being able to adjust to economic
shifts by reallocating assets and refocusing
on what you can do best is essential at a time
when 40 percent of the companies now in
the S&P 500 were not there ten years ago
(and, conversely, 40 percent that were have
been sold, merged or gone out of business).x
Getting the two kinds of roles to mix and
play together is a challenge for all family
businesses and family groups. In addition, a
majority of business-owning families often
mix their personal wealth and finances with
their operating businesses as a matter of
convenience, which can lead to business and
personal liability exposures, public relations
foot faults, loss of privacy, and potential
disputes among family partners.xi
The special needs and problems
of family groups
Also, by definition, in family enterprises,
family members are frequently both
shareholders or partners and key
employees. Being both the owners and the
“brains” leaves an enterprise particularly
vulnerable to substantial disruptions
associated with family member–related
death, divorce, disability and disputes.
Mere business survival in an era of intense
global competition presents an
overwhelming and daunting challenge. The
times present an even greater challenge for
a family enterprise, which faces not just
external threats, but the potential issues of
interpersonal friction and mixing of business
and personal matters.
The different roles family members assume
are a significant factor to consider. In one role
we are family members—wives, husbands,
cousins, sisters, brothers, etc. Our roles in this
context are based on the needs, stresses,
issues and strengths of our families. Just
6
imagine a Thanksgiving dinner for 30 people
and you get the idea of the dynamics.
things up, the family group that prospers
and survives over multiple generations,
more often than not, controls a number of
enterprises under the umbrella of the family
group. Such an umbrella allows the family
group to adapt and adjust to internal and
external challenges and best allocate its
resources and members in a unified but
flexible and organic manner. This is the
definition of the Family Alliance in a nutshell.
Add further to this mix that the family group
at some stage might not possess the
leadership or management tools necessary
to keep a particular family enterprise thriving
as it grows from local to regional or regional
to national in scope. The family group may
have legitimate worries that it is missing
either the skills or the interest to keep the
enterprise in forward motion.
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The Family Alliance
When done in conjunction with appropriate
estate planning measures, a Family Alliance
can ensure the ability of a family group—as
opposed to the family enterprise—to adapt
and thrive over generations in a way that
permits all members of the succeeding
generations who are willing to do so to
participate in the family group and its
endeavors. This continuity planning
approach focuses on the family group, the
needs of its individual members and its
group dynamics. The goal is to develop a
strategy that accomplishes
a number of objectives
beyond merely the
transition of assets from
generation to generation.
• Helping family groups set up systems,
processes and structures that can detect
problems and develop solutions before
those problems endanger any of the
family enterprises.
Family group–focused continuity planning is
by definition multigenerational in nature and
is based on a holistic assessment of the
family’s needs, both material and otherwise.
It requires a team of professionals from
different disciplines who understand the
family group and its family enterprises and
can work together efficiently toward the
Being both the owners and the “brains”
The objectives of this
structure for continuity
planning include:
leaves an enterprise particularly
vulnerable to substantial disruptions
associated with family member–related
• Helping family members
create a vision of what
they want their family
legacy to be, not only in
terms of wealth, but also
in terms of deployment
of real and human assets toward chosen
business, charitable or other missions;
death, divorce, disability and disputes.
• Helping family members develop a
planning strategy that will accomplish
their goals and help sustain the chosen
family enterprises for generations;
• Enhancing the ability of family members
to work together with each other and with
outside professionals to accomplish their
objectives harmoniously; and
achievement of the family’s chosen goals.
Thus, it is “client centric” in approach and
designed to provide lasting benefits.
The use of the Family Alliance supports
multiple family enterprises—both for profit
and charitable—that operate as “separate
members of a greater whole,” while
enabling each separate member to avoid
the liabilities and obligations of the others.
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The Family Alliance: Focusing on the Family in Family Enterprise Planning
It enables each separate member to control
its own affairs and budget, monitor and
separately allocate its own profit, and do its
own accounting. Each separate member or
family enterprise is one part of an alliance of
family enterprises and initiatives operating
under one family name and one family
overarching structure—the family
coordinating entity. Each member of the
alliance can have different levels of
independence, each can have different
members and participants, and each can
have its separate goals and missions. Yet
each, at the same time, is part of a larger
Each separate member or family
The goals and benefits of the
Family Alliance
The Family Alliance approaches family group
succession planning as much more than an
exercise in the preservation and disposition
of assets. It recognizes that families want
their efforts, whether business enterprises or
charitable foundations, to be lasting gifts
and legacies that allow generations of
children to achieve fulfillment as well as
financial independence. Thus, it seeks to
help families determine the shared values
and goals of their families and enterprises,
knowing that the enterprises are merely
means to those ends. The
Family Alliance also
compels families to
establish enduring
structures for family
governance and meetings
(sometimes called “family
assemblies”) as a family
structure separate and
distinct from the family
enterprises and their
management.
enterprise is one part of an alliance
of family enterprises and initiatives
operating under one family name and
one family overarching structure—
the family coordinating entity.
alliance of family enterprises that are
focused on the long-term mission and best
interests of the family group as a whole.
With appropriate structuring and the use of
proper governance, the Family Alliance can
also ensure that all sensitive information
about separate members and relevant family
dynamics are hidden from public view.
8
The Family Alliance helps
families to determine the
core values on which their family enterprises
were and will be founded, which will guide
them, like a compass, through an uncertain
future. It does this not only because these
values form the true life force that unites the
family, but also because empirical study has
proven those values to be essential to the
long-lasting success of any enterprise.xii
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The Family Alliance envisions and
anticipates the need for change, not in core
values, but in business strategies, activities
and structures. Thanks to this perspective, it
provides a flexible structure for all family
enterprises that facilitates business change
in the form of acquisition, consolidation,
spin-off or redeployment of assets. In other
words, it can adapt. The loss, however
unfortunate or untimely, of a separate family
enterprise will not cause the loss of the
entire family structure. Rather, it is merely a
part of the larger structure that, with its
other family enterprises, will survive and
adapt to the next need or
challenge.
which family enterprises they prefer to
support and in which they wish to
participate. As opposed to the one family
business, the Family Alliance promotes and
encourages participation in a variety of
potential avenues of activity, allowing family
members to thrive in the areas in which they
are best-suited.
A key goal of the formation of the Family
Alliance is to build teamwork and union
within the family group and greater family
harmony, which helps the family enterprises
as well. The more unified the family group,
the better it can shape its image for the
With appropriate structuring and the
One of the greatest
challenges to families is
the potential sale of the
“family business” and the
divisions and discord that
such a sale raises. With the
larger Family Alliance that
can grow out of the initial
family enterprise, the
family group will survive
any such event and be
able to plan for it so that
the event will cause the
greater family group and Family Alliance to
prosper and, more important, stay united.
use of proper governance, the Family
Alliance can also ensure that all sensitive
information about separate members
and relevant family dynamics are hidden
from public view.
This flexible legal structure facilitates the
ability of individual family members to invest
portions of their legacy shares into pursuits
of their own dreams, providing them with
superior autonomy, direction and sense of
satisfaction. Each family member can select
outside world and enhance the value of the
family brand. This approach also facilitates
continuity of family control over the family
enterprises by eliminating or mitigating
many of the typical catalysts for family
business breakups.
9
The Family Alliance: Focusing on the Family in Family Enterprise Planning
How the Family Alliance works
In order for this process to work optimally, it
should be founded upon a social assessment
of the family that clarifies the family history,
values and culture. This initial assessment
should also help the family to write its future,
giving family members a sense of shared
mission and purpose that will constitute their
true legacy and leave their imprint on history.
In addition, the assessment exercise should
identify what the family brand really means
to the outside world for business, charitable
and private endeavors.
Armed with such an assessment, the family
can then focus on building the skills it
requires to act in a constructive, united
manner, such as:
• Optimal corporate governance practices;
• Beneficial family governance practices;
• Useful internal communication and
dispute-resolution practices;
• Ways to respect and appreciate individual
contributions of others;
• Ways to optimize teamwork with those
inside and outside of the
family group;
As opposed to the one family business,
the Family Alliance promotes and
encourages participation in a variety
of potential avenues of activity, allowing
family members to thrive in the areas
in which they are best-suited.
Thus, the family group will know and agree
at the outset “why” they are in the
businesses they are in and “how” they want
to do business, which are important
predicates to lasting success.xiii Individual
family members will also understand the
family enterprises that suit them best and
how they can best serve them. They will
have a better understanding and
appreciation for the roles and contributions
of other family members as well.
10
• How to establish
coaching and mentoring
programs for younger
family members;
• How to do leadership
succession planning;
• Contemporary process
and project
management
techniques; and
• Concepts related to best
practices in leadership
and management.
Family governance alone can present huge
challenges, and family groups can greatly
benefit from learning how to use family
councils and family assemblies as private
forums for discussion of shared values,
departures from course and strategic
decisions.
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How the legal structure facilitates
family group flexibility and success
The Family Alliance can take various forms,
the details of which will differ for each family.
In each case, there is one family
coordinating entity. This can be a holding
company or merely a separate entity that
provides the core services for intraenterprise coordination. The eventual choice
and structure will be based on the needs
and desires of the family and its members.
Autonomous Attributes of
Family Enterprises
In each case, the Family
Alliance can house an
unlimited number of
separate member family
enterprises, each of which
can have:
• Its own profit and loss
statement;
• Its own allocation of
profits and losses;
• Its own compensation
structure;
• Its own governance and management;
• Its own separate right-of-first-refusal
arrangements, buyback agreements and
other protective provisions regarding resale
of shares; and, when properly structured,
• Its own individual liability veils to protect
that family enterprise from accidents,
mismanagement or disasters in another
family enterprise.
These separate members can include
charitable foundations and other nonprofit
endeavors, as well as for-profit enterprises,
and they can include specialized vehicles for
A key goal of the formation of the
Family Alliance is to build teamwork
and union within the family group and
greater family harmony, which helps
the family enterprises as well.
• Its own financial
statements;
• Its own tracking shares (which are basically
ownership shares held by different family
members who want to invest in that family
enterprise and which can be used to track
the economic performance of a family
enterprise and pay dividends accordingly);
holding, managing and/or investing in real
estate and securities. Individual family
enterprises can also be easily merged or split,
or they can be taken public or spun off if the
family decides to harvest capital from a family
enterprise or if family members involved in
the family enterprise elect to leave.
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The Family Alliance: Focusing on the Family in Family Enterprise Planning
Superior Leverage
The goal of the Family Alliance is to
leverage off of the collective family name or
the fame of one of its family enterprises. All
or selected, separate members of the Family
Alliance can use the collective family brand
to give credibility and weight to new and
varied ventures. Consider the family names
of Ford, Rockefeller, Gates and others to see
how adding the family name to an enterprise
provides immediate benefits.
The use of a Family Alliance with a
family coordinating entity can also
media buying, public relations efforts and
other purchasing functions.
Privacy Features and Fitness for Families
The use of a Family Alliance with a family
coordinating entity can also provide the
privacy many families seek. If property
structured, all family interactions and decision
making can be kept from management and
employees of the separate family enterprises.
Decision making at the family level can be
sheltered from non–family members’
attention or interference.
Most of all, knowledge of
the estate planning at the
family level can be kept
from management and
advisers to the family
enterprises. This key goal
alone makes the Family
Alliance structure worthy of
consideration for family
groups. The Family Alliance
can also provide the
structure for dealing with
family member challenges,
such as death, disability
and divorce, at a level
outside of the separate family enterprises.
This can allow the family to plan for these
events in the context of the needs of the
family group and not just the individual family
enterprise.
provide the privacy many families seek.
The collective alliance also allows the family
group to leverage its collective strength for
charitable and philanthropic causes.
Challenge grant programs and fundraising
can be vastly enhanced through the
collective family effort, and correspondingly,
these efforts will accrue further benefit to
the family name and its other family
enterprises. The individual family enterprises
can also function cooperatively to leverage
their purchasing power for product buying,
12
As noted, family members in family
enterprises have two roles—their role when
acting as members of the family and their
role as businesspeople. The Family Alliance
structure allows the family to move its family
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role interactions outside the view and
purview of the family enterprises and into
the family coordinating entity. In the context
of discussions at the level of the family
coordinating entity, the family role can be
allowed to speak more freely and to
predominate. Family discussions can be held
confidentially and in an agreed-upon
setting. At the family enterprise operating
company level, the business role can be
allowed to predominate because family
matters can be addressed in another venue.
Other tools used in
the Family Alliance
• Investment advice and wealth management
counseling, particularly with respect to
inheritances and other liquidity events
• Wealth transfer planning to ensure
preservation and enhancement of wealth
• Financial and tax planning
• Financial record keeping for both
convenience and compliance with legal
requirements
• Personal insurance and risk management
The individual family enterprises can
There are various other
resources that can be
established for and used in
conjunction with a family
coordinating entity to
perpetuate a family legacy
and the family enterprises
associated with the family
group. Depending upon
the size, complexity and
needs of a particular family
group, any or all of the
following tools may prove useful to achieving
family goals:
also function cooperatively to leverage
their purchasing power for product
buying, media buying, public relations
efforts and other purchasing functions.
The Family Office
There are thousands of family offices in the
United States that provide family groups with
all kinds of personal and professional
services, delivering concierge treatment
through employees and advisers that are
dedicated to the family.xiv Among the
services that can help a family group to
function optimally and to perpetuate their
legacy are the following:
• Family member education and personal
development
• For families with charitable foundations,
family foundation management services
Family offices can also prove beneficial in
providing pooled purchasing power for
travel services, automotive detailing and
other personal services.
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The Family Alliance: Focusing on the Family in Family Enterprise Planning
The Council of Advisers
A council of advisers can help to fill gaps
that might exist for the family or on boards
of its family enterprises and can function
similarly to the independent directors
serving on a public company’s board by
giving independent advice and
perspectives.
The Family Council or Assembly
A family council or assembly, as previously
mentioned on page 10, can provide a
private forum for periodic and structured
discussion of shared values, departures from
lasting success of a group of family
enterprises. Families have found that, once
established, the family assemblies become
critical events in the yearly schedules for
family members and provide an institution
for open family conversation and “just
getting a chance to talk to each other,” an
opportunity that is frequently lost in
crowded lives.
The Family Foundation
When people think of family foundations,
they often think of mammoth organizations,
such as the Ford Foundation, the Rockefeller
Foundation or the Gates
Foundation. But family
foundations are not only
for the super-wealthy. In
2009, there were 38,701
family foundations in the
US. 49% of these
foundations gave less than
$50,000 and another 40%
gave between $50,000 and
$100,000.xv
A family council or assembly can provide
a private forum for periodic and
structured discussion of shared values,
departures from course, compensation
of individual family members for their
contributions and strategic decisions.
course, compensation of individual family
members for their contributions and
strategic decisions, such as whether to buy
or sell assets or whole enterprises.
It can also provide a regularly scheduled
venue for the entire family to convene,
communicate generally, and continue
building bonds of trust and shared
commitment. This can be critical to the
14
A family foundation is
typically established as a
nonprofit Section 501(c)(3)
tax-exempt organization, and it is dedicated
to a specific cause or causes. Structured in
this way, it provides an ideal vehicle for
establishing the family’s “brand” and a
legacy that will survive in perpetuity.
The family foundation can help the family
group’s for-profit enterprises as well,
providing valuable public relations
opportunities and forums for relationship
building with government and with nonprofit
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agencies. Creating a foundation to “give
back” to the communities that are home to
family enterprises is also relevant to the
value of the brands of those enterprises.
Furthermore, the foundation can provide a
perfect place to work for some family
members. These family members may be
too young or inexperienced to work in other
family enterprises, more senior and focused
on giving back, or just more inspired by the
notion of working for a chosen cause not
related to commerce.
The keys to success:
the right people and
people skills
In order for a Family
Alliance to function
optimally, it is important to
have an interested family
group, the right team of
professionals and the right
quarterback leading the
team.
step and begin the process of understanding
family values and goals. Most families are
unable to take the steps needed for them to
survive as family groups over multiple
generations not because they do not desire it,
but because they do not start the process.
All that is needed is to take the first step.
The rest will follow.
The results
Because the process of a developing a Family
Alliance is so new, there is not yet any long-
But family foundations are not only for
the super wealthy. In 2009, there were
38,701 family foundations in the US.
49% of these foundations gave less
than $50,000.
The family group likely to
get the most out of the
process is one that has courageous leaders.
The founders or other leaders need to be
capable of setting and meeting goals, open
to learning from each other, and know how
and when to let go, entrusting others to take
on key roles.
An Irish proverb says that the two hardest
parts of any race are the first step and the last
hundred yards. The most important part of
the process to provide a family group with the
structure it needs to survive is to take the first
term empirical study of how it contributes to
the sustained success of a family group.
However, the family groups that have used
the process thus far have enjoyed significant
satisfaction and success from it.
In one case, for example, a family that
operated a successful regional enterprise
expanded the activities of that enterprise,
giving it a global reach and a significant
increase in revenues. Younger generations of
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The Family Alliance: Focusing on the Family in Family Enterprise Planning
the family also found key roles they could
play within the family group’s for-profit or
nonprofit enterprises as well.
In conclusion
The Family Alliance structure offers several
advantages that appear especially wellsuited to the stresses and family dynamics of
today. Because of its flexibility and organic
nature, this model makes it more possible to
accommodate the increasingly diverse needs
and interests of multiple family generations
Most families are unable to take the
steps needed for them to survive as
family groups over multiple generations
not because they do not desire it, but
because they do not start the process.
while remaining true to the family’s timeless
legacy, values and purposes.
While additional study on the process will
come over time, the early results are very
promising. For those with the courage,
commitment and experienced counsel
necessary to build a durable home for the
family’s dreams, sustainable success will
follow.
16
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About the Author
Frederic J. Marx
Frederic J. Marx is a partner at Hemenway & Barnes LLP, a legal and fiduciary firm in
Boston. Fred heads up the Business Law Group at Hemenway & Barnes whose practice
focuses on the sophisticated strategic planning and tax needs of multigenerational
families, businesses and nonprofits.
Continuity planning for family businesses is a significant part of what Fred offers clients,
helping families plan structures that are designed to thrive through the generations and
address a variety of needs, including succession planning, diversification of the family
into other strategic ventures, philanthropic interests and family office activities.
Fred is a member of the Massachusetts Bar and has served as Chairman of the Business
Law Section of the Massachusetts Bar Association and as Chairman of the Nonprofit
Organization Committee.
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The Family Alliance: Focusing on the Family in Family Enterprise Planning
iHere
are definitions of selected family-related terms used in this paper:
The “family group” refers to the family as a whole, all of its generations, enterprises and
activities, including business and charitable ones.
The “family coordinating entity” refers to an umbrella entity, designed to act as the central
hub for the multiple family enterprises, business, charitable and personal (as described in
Section 6 herein) that operate as independent separate members under the one family
umbrella structure.
The “family enterprise(s)” includes operating businesses, investment funds, charities, private
foundations and other enterprises controlled by the family.
Family Alliance—the structure that supports multiple family enterprises operating under the
unified banner of a family coordinating entity.
iiSee
Sheelah Johnston, “The Family Business: Statistics, Profiles and Peculiarities,” Business
Focus/Manila Bulletin (Feb. 6, 2004); Commentary, Family Business Review, Summer 1996;
Nancy Bowman-Upton, “Transferring Management in the Family-Owned Business,” U.S. Small
Business Administration (1991).
iiiSee
Financial Planning magazine, November 1999.
ivSee
American Family Business Survey, published by Mass Mutual/Raymond Institute (2003).
vSee
Melissa Carey Shanker and Joseph H. Astrachan, “Myths and Realities: Family
Businesses’ Contribution to the U.S. Economy,” Family Business Review (Summer 1996).
viSee
Sheelah Johnston, “The Family Business: Statistics, Profiles and Peculiarities,” Business
Focus/Manila Bulletin (Feb. 6, 2004).
viiSee
overview of “The FFI-Goodman Longevity Study,” published by the Family Firm
Institute (2011); Boston Globe article (May 4, 2003); Nancy Bowman-Upton, “Transferring
Management in the Family-Owned Business,” U.S. Small Business Administration (1991).
viiiSee
ixSee
study by Grant Thornton cited by press service, News Canada (2011).
overview of “The FFI-Goodman Longevity Study,” Family Firm Institute (2011). Study
participants may be more sophisticated, having been recruited by professional advisers who
are members of the Family Firm Institute or alumni of Babson College for business study in
Wellesley, Mass.
18
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xSee
2011Bloomberg Businessweek advertisements for iShares, offered by BlackRock Fund
Advisors, data cited as of November 2010.
xiSee
Family Office Exchange press release dated Jan. 20, 2011, entitled “New Study
Documents How Business-Owning Families Are Responding to the Need to Separate Their
Personal Wealth Management from Their Operating Companies.”
xiiSee,
e.g., the book published by Stanford Business School professors Jim Collins and Jerry
Porras, based on six years of empirical research involving companies that stood the test of
time for generations and those that did not, “Built to Last” (2002). In Collins’ own words,
“…we found that the visionary company [the one built to last] was guided more by a core
ideology—core values and a sense of purpose beyond just making money—than the
comparison company was.” Collins says on his own website that “we chose the word
‘ideology’ because we found an almost religious fervor in the visionary companies as they
grew up that we did not see...in the comparison companies. 3M’s dedication to innovation,
P&G’s commitment to product excellence, Nordstrom’s ideal of heroic customer service, HP’s
belief in respect for the individual—those were sacred tenets, to be pursued zealously and
preserved as a guiding force for generations.”
xiiiSee,
for example: Dov Seidman, “How: Why HOW We Do Anything Means Everything”
(2007); and Simon Sinek, “Start with Why” (2009), a study of “why some people and
organizations are more innovative, more profitable and command greater loyalty from
consumers and employees alike.”
xivAs
of July 2011, the Family Office Exchange website estimated that there were between
2,500 and 3,000 formal family offices in the U.S., and possibly another 6,000 or more existed
informally inside of privately controlled businesses.
xvSee
“Key Facts on Family Foundations,” dated January 2011 by the Foundation Center
19
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