子女作为合作伙伴：扩大家族决策圈子

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Natalia: Hello everyone, and a warm welcome to this new episode of the Life & Legacy Podcast Series!  My name is Natalia Murphy and I’m a Wealth Advisor on Team Mexico at J.P. Morgan Private Bank. Today, I am joined by my colleagues Carolina Cintra, Wealth Advisor for Brazil, and Carol Mushriqui, Wealth Advisor for the Middle East and Turkey.

A really gratifying thing about our jobs as wealth advisors is that we get to meet fantastic families in our respective regions and become involved with them in their decisions on how best to preserve, and eventually pass on, their family wealth. Usually the patriarchs or matriarchs of the family are the primary decision-makers when it comes to passing on family wealth. But frequently they want to involve their children, or what we refer to as the Next Gen, in the decision-making process. Today we will discuss what are some of the benefits of including the next gen in such decisions, and share some tips on how best to get started.

Carolina, you’ve worked with many families in helping them manage their wealth and legacy. Could you describe the benefits you’ve seen when parents include children in the decision-making regarding their wealth?

Carolina: Thanks Natalia, and hello everyone! What I’ve seen is that involving children in the operations, and eventually decision-making, of the family’s businesses, family offices or investments provides an excellent opportunity to teach children the ropes. In leading by example, parents can teach their children what they do and how they work with others. This is especially relevant when other parties are impacted in the transition, for example employees and business partners. Having the current and the next gen together for a period makes the process smoother when the actual transition happens. All parties know each other already which makes the transition easier.

Carol: Absolutely Carolina, I couldn’t agree more. Numerous studies have shown that the number one reason why families have failed to transition wealth to the next generation is due to a breakdown in communication between generations and family members. Involving children early on in the decision-making process provides a wonderful opportunity to nurture family relationships and develop those essential communication skills.

And from the perspective of the next generation, I think it is very important for them to feel that their opinion and perspective is heard and valued in the family. From my experience and interaction with the NextGen, there can often be a sense of frustration if they feel they are not as involved as they would like to be.  They struggle to find a sense of identity and purpose, particularly in the context of a family business. The more involved they are in the decision-making process, and the more exposure they get to learn from their parents, the better equipped they will be to take on their future roles and responsibilities with confidence and success.

Carolina: Correct… there’s nothing that pleases parents more than to see their children succeed in life!

Natalia: Well said, Carolina. In my experience, too, I find that the benefit of being able to pass on core values as well as the vision for the family going forward is really important to parents. 

Carol, you also touched on an important benefit – that is, the opportunity for the NextGen to learn.  Of course, one very important aspect of this is that siblings learn how to work with each other.  They create shared understandings and learn how to resolve conflicts among each other, which is crucial for future decision-making.  And as the relationships between family members develop and grow, this also enhances the quality of decisions that children can make independently and collectively within the family. It also imparts a work ethic to the children and allows for the satisfaction that comes from making a contribution to the family’s flourishing.

Carolina: Also, importantly, it helps both the parents and children identify their own strengths and areas for development, perhaps giving them a better handle on what educational and practical experiences they want to pursue. For example, a family I was speaking to recently was very focused on preparing the NextGen for its participation in the board of directors. They ran a number of programs to encourage the NextGen to take an active role in the company and learn the skills they need to be an effective director. The topics covered were vast, from business and financial issues to softer matters that the next gen found interesting and helpful. More than the content, these programs helped the next gen to connect with other family members, revive shared values and also think about and discuss new ideas and endeavours together.

Natalia: That’s a great example Carolina. Families often ask us how and when they should start involving their children in decision-making. Carol, do you have any thoughts on this?

Carol: Well, firstly Natalia, I don’t think there is a “one size fits all” approach here. What works for one family may not necessarily work for another. But typically I would say that the earlier you start the better, and I would consider maturity before age to be the determining factor.

For example, one family I worked with wanted to teach their children, who were in their mid-teens, how to handle a budget, and so the gave them the task of working together to plan a family holiday within a fixed budget. The children had to work together to decide where and when, and how they would get to their holiday destination, where they would stay and what activities they would do together – with no input from their parents! I thought this was a great way to encourage their three children to work together and make decisions on behalf of the family, in an age-appropriate way, before involving them in more complex business decisions.

Carolina: What a fantastic idea! Similarly, one family I worked with were also keen to involve their next gen in investment decisions, and so they created a separate fund specifically for philanthropy and asked their children to manage that. They started with a small amount initially, but to encourage their children, they agreed to match the return on investment on an annual basis. We worked closely with the children to determine the causes that they felt passionate about, and how they wanted to invest the initial funds, but I tell you the satisfaction that they experienced during that journey was remarkable and the skills and sense of achievement that they gained has really prepared them well for their future roles within their family’s business.

Natalia, from your experience, do you have any other tips of best practices to share with our audience?

Natalia: What great examples you have both shared on ways other families have involved the next generation in their family decision making. I think, more generally, I would encourage our listeners to show a willingness to involve the NextGen… show them that you want their opinion, and want them to be involved. And also to see the value in their perspective, even if it’s different to your own. One of my clients told me recently that his son has made a hugely successful investment in the e-gaming industry, an investment which initially his father was completely against. It is often the case that a different opinion can offer a fresh perspective, and revive struggling businesses or investments. So I would urge our listeners to listen to their young people and take into consideration their thoughts and views.

Carol: Absolutely Natalia. I think it’s also really important that the NextGen are given the license to fail, and that parents provide a soft landing for them when they do so. It’s human nature to look back with rose tinted glasses and share stories of success and triumph. But in my experience, it’s just as important to share stories of failure and disappointment. This gives the next generation permission to try new things and to fail if necessary – no one gets everything right! As one of my clients said to me recently “overnight success take a long, long time” – probably after a string of failed attempts!

Carolina: That’s so true Carol.

Well, I think that this a great note on which to end this podcast. Your Wealth advisors at JPMorgan, all around the world, are here to help you make sure you achieve your goals and plan carefully for the successful transition of your wealth. We are speaking to families more and more on how to prepare the next generation, and would be delighted to share our thoughts and experiences with you.

Thank you for joining us today and we hope you’ve enjoyed this episode of our Life and Legacy Podcast Series.