1. Royal Agriculrural College, Cirencester 3 March 2009
STEP Gloucester and Wiltshire Branch Families at War – mediating trust, estate and family business disputes
Ian Marsh TEP
familydr
Royal Agriculrural College, Cirencester March 2009

2. Royal Agriculrural College, Cirencester 3 March 2009
A question (or 3) for you
How do you deal with conflict in your family business?
How well does that work for all concerned?
Would everyone else concerned agree with your first two answers?
Royal Agriculrural College, Cirencester March 2009

3. Conflict is inevitable …
I am in conflict if I believe that you and I have incompatible goals and that your actions will interfere with me achieving mine – and I cannot just accept that.
Royal Agriculrural College, Cirencester March 2009

4. The risk of destructive conflict (UK - 2006)
2 out of 5 marriages end in divorce
1 in 4 families fall out over a will
42% of siblings never talk again
20% never talk to their mother again
11% make a will to block inheritance
Only 30% of family businesses make it to the second generation, and only 13% to the third
Royal Agriculrural College, Cirencester March 2009

5. The cost of destructive conflict
For the family
Loss of health, family and fortune
For the trustee
Loss of trust and opportunity
Reputational risk
For the adviser
Loss of clients
Royal Agriculrural College, Cirencester March 2009

6. Royal Agriculrural College, Cirencester 3 March 2009
Sources of tension
Sibling rivalry
Generation gap/digital divide
Workers v investors
Bloodline v in-laws
First family v second family
Family v professional management
The vision thing
Royal Agriculrural College, Cirencester March 2009

7. Nothing is ever about what it’s about
Relationships
How do I want to be treated by others?
Saving face
Who am I – and how can I preserve that?
Process
How will we communicate and make decisions?
Royal Agriculrural College, Cirencester March 2009

8. Royal Agriculrural College, Cirencester 3 March 2009
An anatomy of conflict
Perceived threat
Failed communication
Building alliances
Going critical
Royal Agriculrural College, Cirencester March 2009

9. Royal Agriculrural College, Cirencester 3 March 2009
The big bang
Any change – or threatened or rumoured changed, eg:
Death
Separation/divorce
Managerial succession
Ownership succession
Proposed sale of the family business
Restructurings and reorganisations
Uncertainty, eg global financial crises
Royal Agriculrural College, Cirencester March 2009

10. Royal Agriculrural College, Cirencester 3 March 2009
“Many people fantasise secretly about revenge. Few carry it out. Most hire lawyers instead.”
Kenneth Cloke, Mediating Dangerously
Royal Agriculrural College, Cirencester March 2009

11. How could you do it better?
What do you want to achieve – and why?
Can you do it without the other person?
If not, what do you need them to do?
What do you need to say or do, for them to do that?
Put yourself in their shoes
Why would they say no?
What must you do to change their minds?
Get help
Even something as simple as estate planning …
If want wealth to pass down and they will fight you can’t do it without them!!
Royal Agriculrural College, Cirencester March 2009

12. Royal Agriculrural College, Cirencester 3 March 2009
Some golden rules
Take responsibility for the problem
If you don’t “they” control your destiny
Assume nothing
Assumptions are dangerous – and usually wrong
Be curious
You can’t change somebody’s mind if you don’t know what’s in it
Listen
You have twice as many ears as mouths for a reason!
Royal Agriculrural College, Cirencester March 2009

13. The role of good governance
Agree now how to resolve future differences
Conflict diagnosis/audit
Designing an effective process
Getting people to buy into it
Getting people to use it
Using it : training , coaching, administration, funding
Royal Agriculrural College, Cirencester March 2009

14. Royal Agriculrural College, Cirencester 3 March 2009
And if all else fails?
Park the tanks on the lawn if you have to
But don’t abandon diplomacy
And remember –
30% of no-lose cases do lose
Judges can’t sign peace treaties
Royal Agriculrural College, Cirencester March 2009

15. How one family say they deal with conflict
“Fortunately it never happens”
“We’re very democratic - I have 51%”
“I’m a great believer in consensus”
“We talk a lot, and then Dad does what he wants”
What people say in family meeting and in private is sometimes very different!
NB myths and legends exp re intractable disputes
Royal Agriculrural College, Cirencester March 2009

16. Royal Agriculrural College, Cirencester 3 March 2009
Back to you …
How do you deal with conflict in your family business?
How well does that work for all concerned?
Would everyone else involved agree with your first two answers?
Royal Agriculrural College, Cirencester March 2009

17. Royal Agriculrural College, Cirencester 3 March 2009
Contact Ian Marsh at familydr Central Court 25 Southampton Buildings London WC2A 1AL tel: +44 (0) fax: +44 (0)
Royal Agriculrural College, Cirencester March 2009