Family governance and family business succession – how to secure assets for generations?

Entry

Many companies established in Poland in the 1990s, faced with a changing economic and demographic reality, have been facing a serious succession challenge for several years now. The founders, who spent decades building their businesses, often failed to prepare a plan for transferring power and wealth to the next generation. There were also often no incentive mechanisms to convince the younger generation that it was worthwhile to jointly develop the businesses established by their predecessors. This situation poses a risk to the future of these companies, and thus to their employees, contractors, and entire local communities. It is in this context that family order and well-thought-out succession are becoming particularly important.

Nowadays, in the face of dynamic economic and social changes, family order becomes a key element in planning the future of businesses and private assets. Family businesses, real estate, and capital accumulated over generations are legacy assets that naturally require care and well-thought-out and safe successionBut family governance is not just a strategy for managing the future – it is also a way to take care of the older generation and cultivate values, which laid the foundations for today's possessions.

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What is family governance in practice?

Family order is a common vision and plan for the future, thanks to which your family and business can grow in harmony and peace for generations to come. These are not rigid rules or official procedures, but well-thought-out principles that help avoid unnecessary disputes and doubts, when the time comes to hand over the reins to younger people.

Thinking about family order means in practice:

• Ensuring that your life's work remains in good hands,
• Taking care of the education of the younger generation,
• Taking care of the family's seniors and their comfort,
• Preparing successors to become responsible owners and managers,
• Building family bonds based on trust and honesty,
• Ensuring security and stability for the whole family,
• Implementing activities to consolidate the family business,
• Protection against conflicts among heirs,
• Developed dispute resolution mechanisms.
• Analysis of tax and legal issues, minimizing the risk of costly disputes and losses.

Family foundation – a practical succession tool

There are many tools you can use in the succession planning process – from simple solutions such as:

• Testament,
• Debt collection record,
• Donation agreements,
• Inheritance orders,

to more complex structures, such as succession management agreements or holding companies. However, all of these tools, while important, operate on a case-by-case basis and often fail to provide comprehensive, long-term protection for the entire family.

Therefore, it is good news that the Polish legal system has family foundation – a modern and versatile solution. It allows you to systematically and comprehensively:

• Separate assets into a separate entity, protecting it from claims or divisions,
• Ensure consistent asset management in the long term,
• Express and protect the founder's will regarding the future of the business and family,
• Take care of financial stability of both future heirs, as well as older family members.

Family governance is not only about succession – it is also about caring for the seniors of the family

It is worth remembering that family governance in its fullest form includes not only securing financial and management stability and stability for the future of subsequent generations, but also respect and support for older peoplethat laid the foundation for today's wealth. These people often:

• They were the founders of companies and initiators of ventures,
• They have built capital over decades and are a source of family values, traditions and valuable experience.

Therefore, in the succession plan and in the construction of the family order it is important to secure their needs, including:

• Creation for them financial background and healthcare,
• Taking into account their role in the advisory process and the transfer of experience,
• Guaranteeing respect and their rightful place in the family structure and in the future management of property.

Summary

Consciously implementing family governance in the succession process guarantees continuity and security for the company and its assets, peace and predictability within the family, as well as respect and support for the family's seniors, who are the foundation of this history. Establishing a family foundation and written succession principles is the best investment in the future today, equally protecting tangible and intangible assets, building an intergenerational bridge based on shared purpose, cooperation, respect, and a long-term vision.

We invite you to cooperate

Want to secure the future of your family and assets in a safe and thoughtful manner? Take advantage of our support! At PMR Restrukturyzacje, we specialize in succession planning and implementing family governance, including the creation of family foundations and the development of comprehensive strategies for businesses and families. We provide a personalized approach, legal and tax advice, and support at every stage of the process. Contact us and see how we can help you secure the future of your family and your business.