CEO Adviser: Life, Death and Legacy

At the origin and center of every successful family-owned business are the founder(s) and elders. In their lives, we find the most valuable and often hidden assets: their expertise, business savvy, personal values and ethics, lessons learned and family stories.

Two prominent family-business experts who recognize the importance of human assets to long-term success are James E. Hughes Jr.

and John L. Ward. Hughes, author of Family Wealth: Keeping It in the Family, emphasizes, The assets of a family are its individual members. The wealth of a family consists of the human and intellectual capital of its individual members. Similarly, Ward, a professor of family business, says, The idea of passing on a value system is fundamental to the most successful business-owning families.

Yet the heart and soul of the family enterprise, its history and human heritage, are seldom used to full advantage. Often overlooked, underappreciated and underleveraged, these assets remain virtually hidden.

Why? Two very compelling reasons: money and death.

The first is inherent in our American view of wealth. The term wealth management has been around at least since 1933, although it didnt become commonplace until the 1990s. Today, with a focus on financial capital as wealth, a host of advisers helps shepherd family enterprises through thorny issues like tax planning, investment portfolios, governance and estate planning. Following their lead, many family businesses invest only modestly, if at all, in their own heritage the wisdom of the very individuals who successfully launched and managed the company over the years, as well as the rising generation who needs it.

The second reason is simple and unpleasant. Woody Allen said it for most of us: Im not afraid of death; I just dont want to be there when it happens.
We Americans dont like death. This cultural trait is well known to Richard Wagner, a psychotherapist and author of The Amateurs Guide to Death and Dying: Enhancing the End of Life. Wagner, who for more than three decades has worked with individuals on the cusp of their final days, says, We are notorious for ignoring and denying death. This approach inevitably leaves us unprepared and frightened.

Whether we are in perfect health or face a medical verdict that the end of life is on the horizon, the issue of hope confronts us. In the most practical terms, hope is inherent in our individual story, the legacy of our life experience we can offer to family and loved ones.

The benefits and positive return on investing in heritage for family businesses are both personal and corporate.

Personal benefits are making headlines in the health care field, notably in clinical settings associated with palliative care for the terminally ill. The past decade has witnessed a rapid growth in the use of dignity therapy following the work of Canadian psychiatrist Harvey Max Chochinov. Telling our unique story has significant and proven positive therapeutic effects.

Recording facts about ones life is important for family and business. Equally valuable are the core things that we want others to remember about us the lessons learned, our values and ethics, our advice or guidance, our hopes and dreams to be passed on to future generations. In the process, we create a greater appreciation for our own role in life and in the lives of family members, and we gain a deeper sense of personal value and dignity.

On the corporate side, some companies establish family-business archives, including a robust oral history program, to capture, preserve and make available their unique human and historical capital. Some major benefits include support for family succession planning and leadership transitions; marketing and branding; and using heritage to unite, inspire and educate personnel.

A family-owned companys heritage and intellectual wealth offer a vital and lasting legacy that can help carry the enterprise through generations of change and challenge.

Richard Hobbs is a historian and archivist with the Winthrop Group. Reach him at [email protected].