A system of shared decision-making, typically by a board of directors and a family council, known as Family Governance supports the owner family in managing its relationship with its wealth and businesses. A Family Constitution that captures the family’s vision and core values, a family employment policy that specifies the qualifications for family members to work in the company or family office, an ownership structure that permits corporate control, and competent nonfamily managers who set the bar for the family business’s professional management, are frequently helpful in achieving this goal.
Some family businesses create family constitutions to regulate the interactions between family members, management, and shareholders. The rules and regulations that shareholders will adhere to are made explicit in the family constitution.