It is quite a milestone when a family sets up a family council. Its presence signals that the family has placed non-financial activities — personal relationships, learning and development, philanthropy, social values and building family connections — on an equal level with their financial activities. They have made a commitment not just to be a financial entity and a business, but a vibrant family creating its own value through its action. They show that the family is more than a business or family office; it is an active, life-enhancing entity for family members and those around them.
The first years of a family council tend to be rich, strong and generative like the seasons of spring and summer. Councils draft family constitutions, hold meaningful family meetings, carry out philanthropic initiatives and develop education programs for the family’s young people. This period is intense and difficult, but ultimately rewarding.
Often, however, the active core group of the family that gave their all at the start of the family council eventually begins to tire and pull back. Activities that were fun and productive become a bit repetitious. Now, meetings begin to seem empty or unproductive and people stop attending. Differences emerge and family members decide to stop engaging rather than work to find common ground.
As the air chills, leaves fall to the ground. Over time, the energy predictably cycles through fall and winter seasons. This brings a time of consolidation, shedding what is no longer useful and hopefully recovering from the burnout created by the earlier stages. But is this the end? Is a family council simply time-limited — destined to work for a while before inevitably losing steam?
Struggling against entropy, families often find it difficult to muster the energy to do the work of family governance. Still, some families refuse to accept this fate and instead resolve for their council to remain a focus in order to preserve their shared identity.
A Natural Cycle
What can be done when a family council encounters autumn and winter? Learning from the actual seasons offers some insight. Each cycle brings renewal, first quietly in dormancy and hibernation, then with new flowering. A family council can note the coming of autumn and take a time out to refresh, allowing family members to go their own ways and have new experiences.
My colleague Cynthia Scott first brought to my attention the regenerative cycle of renewal that is built into living systems and how it can be applied to the ebbs and flows of a family system. This is not to imply that this seasonal rotation is linked to the actual calendar. Instead, it’s a metaphorical cycle of renewal.
Spring allows emerging energy to take form after a dormant winter where there is a period of rest and “composting” of what no longer has meaning or use, making room for new growth. Summer is when new forms reach their full expression, and innovation manifests. Fall celebrates what has worked — an acknowledgment and harvesting of what nourishes the family. Winter again brings rest, consolidation and the digestion of nutrients from the last cycle of activity — a time to revisit strategy and direction.
After this metaphorical winter, new life emerges in the family council. This can happen by calling together a new group of family members — maybe those who are just growing to adulthood or newly married-ins — to bring fresh ideas to the council. The old leaders can agree to step aside (wise families have term limits, not to push people out but to make room for new ideas) and new ones can step up. The council can ask, “Given what we have done, what new achievements can we envision for our next spring?” They may find that some elements of the family who have felt excluded or did not participate in the previous year’s agenda now have innovative ideas of what the family can be. New projects are like new plantings, leading to new leaves and flowers.
Families that have had councils for a generation or more naturally encounter these seasonal shifts and create policies and practices not to merely sustain, but to breathe new life for continual evolution. A family charter and agenda can be refreshed and re-envisioned each seasonal cycle (not necessarily a calendar year). When we see families that have succeeded over many generations, they invariably talk about how a new generation or leadership group emerged with new ideas, and how they are not doing what they did a generation ago.
A Proactive Process
What specific actions do we see families take to renew their family councils?
- Seeking out networks and attending gatherings of other families to absorb new ideas.
- Reaching out to those who have been “outliers” to ask what might make family engagement worth their while.
- Encouraging family members who are coming of age and who have not been active to get involved.
- Revising agreements and policies and adjusting them to fit the interests of a new generation.
- Offering easy paths for new family members to learn about family activities and to become part of them.
- Creating task forces and initiatives that allow family members to consider new directions, including new approaches to business and investment.
- Making sure that resources are available to support shared activities and these new paths.
A family council is a wonderful step forward for a family, but it cannot be an edifice constructed once and then lived in forever. It is a first draft of the future. As the seasons change and the family grows, the council and family governance must be prepared to continually reinvent itself.