The last 10 days have been spent celebrating the life and mourning the loss of Her Majesty, Queen Elizabeth II.
As the entire nation continues to remember her magnificent reign and looks to the new King Charles for both leadership and guidance out of this sad time, we thought we would take a look into her succession plan and unpick what Family Offices can learn from it.
The Royal Mail organised a photoshoot for a stamp sheet to mark the 90th birthday of the late Queen … [+]
1) Find your successor early.
The Royal Family’s line of succession is pre-defined. King Charles has always been the next-in-line for the throne followed by the Duke of Cambridge who is presently succeeded by his children: Prince George, Princess Charlotte and Prince Louis. This would change if Prince George had children during his or his father’s reign but the first-born strategy has existed for generations and it means that succession planning can begin from birth.
In Family Offices where a Principal or Wealth Creator has multiple children, it is vital that in the event of death, the family has a single member of the family to call upon to lead. A family conflict in a quest to find a successor could jeopardise the future success of the Family Office and indeed the family. While this must be defined from a legacy-planning perspective, it also needs to happen to best prepare your successor and this does not always have to be a hereditary hire.
I often speak to Principals about hiring their next generation. This has become an increasingly popular trend as tomorrow’s leaders are often more interested in making a social impact; something 73% of next-generation family members told Agreus as part of a recent survey. Other reasons for hiring a successor might include the next generation being passionate about pursuing a career outside of the family, heirs being unqualified for the position or an absence of any descendants at all.
We also speak to Principals with children about giving the next generation a choice to lead. A choice which should only be given if they are both qualified for the role and aligned with the vision and values of the organisation. Learning from your next generation is vital but forcing them into succession is not. Equally dissolving power to a relative based on nothing but bloodline can be just as catastrophic.
Hiring your next generation does not weaken a family or dilute its messaging but instead enables Family Offices to grow, to diversify and to strengthen their values while as a Family, enjoying its success and the mark it is making on the world.
2) Start dissolving responsibilities and power early.
Following on from our earlier point about finding a successor early, by doing so you are also able to prepare them for leadership which the Queen had been doing for many years with the then Prince Charles.
Since 2017, the Queen had been slowly stepping away from the public eye and allowing her future successor to lead on public engagements. In that year, King Charles made more public appearances than any other member of the Royal Family and he had been taking on more and more of the Queen’s responsibilities ever since.
In 2021 it was publicly announced that Prince Charles would take on more of his mother’s duties which commenced with acting as the Queen’s official consort to the State Opening of Parliament in May. It was also reported that Charles spoke with his father, the Duke of Edinburgh in the hospital prior to his passing about the new role he must play in the Royal Family going forward, taking on a greater burden of major royal duties before officially assuming the throne.
In a Family Office, it can be incredibly difficult to dissolve power or responsibility and this is mostly due to the fact that Principals relish in having autonomy and control. One of the very reasons they would have established their Family Office some time ago. According to our Intergenerational Leadership report, 54% of today’s leaders told Agreus that they do not trust their next generation to run the Family Office while a further 42% said they believed the next generation were unprepared for succession. Although difficult, it is vital that responsibilities are slowly dissolved to best prepare your successor for leadership.
This also offers you as the current Principal the chance to mentor, shape and correct mistakes that might be made along the way. While ensuring the Family Office is run as you wish after your passing, it offers a learning opportunity that, unplanned for, might never happen. Succession is not always a result of reaching a certain age and the pandemic certainly offered a realisation of mortality amongst many of today’s Principals.
We are living through the greatest transfer of wealth that this world has ever seen, letting that wealth pass into unprepared hands could be detrimental to your legacy.
3) Don’t be afraid of change.
Despite spearheading the Royal Family for some seventy years and remaining very much the lady in charge, the Queen welcomed three generations along the way and within each of them, gave Royal Ascent to the modernisations and changes they brought with them. From social media strategy to philanthropy, taking on paid-for professions outside of the institution to travel. The Queen was not afraid of change and you should not be either.
The Royal Family has changed immensely over seven decades. We interviewed Nick Loughran, the Co-Founder of Integra, a strategic communications company he founded after years of working for the Royal Household. We asked him what Family Offices can learn from arguably the oldest Family Office in the UK and he said, it was all about the way in which different generations were able to work completely differently from one-another.
He said: “I had different Principals of different ages with different outlooks. When I was there, one of the biggest parts of my job was supporting them as they worked out what role they wanted to play within the institution and the impact they wanted to make outside of that. The biggest difference was in the style they took on in royal work. They will, as members of the Royal Family, always need to be seen at certain events of national importance but they can make an impact in a variety of other ways. The Queen has done so through 70 years of steadfast service while the Prince of Wales has done so very successfully in a charitable entrepreneur type of way, especially through the Prince’s Trust. And the next generation have taken on a campaigning style, equally successfully. If you look at the biggest initiatives to have been created under that style, they have changed the conversation around mental health, climate initiatives, or the support we give to wounded servicemen and women.
“The younger generation of the Royal Family have each taken a topic and then used their platform to convene as many of the right people and organisations as possible for a central goal. I offer this background as it was a new model and a very successful one and it is akin to many Family Offices today. Principals do not necessarily have the same platform or profile but the collaboration approach is really quite important when looking at their philanthropic work. With the next generation of Family Office Leader, there is a willingness to work with others on a wide range of initiatives, particularly around global issues where you understand you need others to make a difference and cannot do so alone. I took a lot of these learnings with me from Kensington Palace, mostly around the power of convening and collaboration – to see an issue so great that you struggle to see how to make a tangible impact. You then break it down, focus on one element to change for the better and crucially, consider how you can work with others to see great results.”
The Queen’s passing has saddened the nation and while it might be incredibly difficult to think of such a solemn situation in your own Family, as Maya Angelou, the American memoirist, popular poet and civil rights activist once said you must “Hope for the best, prepare for the worst and be unsurprised by anything in between”