What is the most important strength of Family Business leaders?

Our recent research found that the number 1, top strength, or Career Catalyst for family business leaders is Item 13: “Keeps confidences about family business wealth.”

Hmmm. On a scales of 1-10 how well does your family business keep confidences about family wealth? Here are some quick thoughts about how to apply this finding to your family enterprise or family business consulting.

Title:  What is the most important strength for Family Business leaders?

Sometimes people wonder, “what are the top competencies that family business leaders need?”  And I’m happy to report some early results from the Assess Next Gen Family Business Leadership 360 assessment. This data is from 163 responses in the last few months.  Here is the top score, in other words, the Career Catalyst, the behavior that is number one. I’ll give it to you and then I’m going to ask you to reflect on it.

The top score, the thing that our raters said others ought to do, is item number 13: “Keep confidences about the family business wealth.”  To repeat,  the most important strength of Family Business leaders is to “keep confidences about family business wealth.”  What does that mean for you and your family or your enterprise?

I recently asked that question of a friend of mine, John Broons, who’s in Australia, who is pretty brilliant.  And he said, “family wealth needs to be part of the conversation.  It’s too often not discussed.”

I agree.  We need to prepare for risks, like a transition or a succession or continuity or another line of business.  And too often family members don’t have any idea of what’s next.  There’s the core business. Perhaps there might be other lines of business, but family wealth conversations should definitely stay within the family.

Many of my clients have a charter or clause which states, “This is what we will say, and to whom.”   They may have a conversation with the wealth advisor and estate attorney, and they may not have that conversation with somebody like me, a business consultant.  The family members are the only ones who have access to that information. This is to protect them from journalists or politicians or inappropriate people seeking to learn something about that wealth. And often this confidentiality clause is written in an agreement. So we’re really talking about the two first words here…

Keep confidences.  The most important strength of Family Business leaders is to keep confidences.

How do we keep confidences?  I think we need to reinforce some useful guidelines.  My clients require  trust guidelines. Let me give you a quick example. One of my clients has eight G4 children on this side and four children on this other side. Potential conflicts, right?  So they made an agreement in writing, and verbally reinforced it in every one of their meetings, about what could be shared with Doug as the family business consultant working with that G4 generation. My focus is on leadership development. Part of my job is to reinforce for them what’s confidential and what they need to keep confidential.

It’s a bit like driving a car when you’re driving down an unfamiliar road.  You’ve got the white lines on the right side, the yellow lines on the left side.  Like a good driver, we need to keep confidences. We don’t want to go to the edge of those lines.  We don’t want to go off the center of the road. We certainly don’t want to go in the dirt or the gravel on the side.

So, my invitation is to keep confidences about family business wealth.  Keep that conversation sacred. There you go. Tip of the moment.

Originally Published – Action Learning Associates