Questions Business Owner Clients Should Be Asking NextGen

A recent BBH survey highlights the tough conversations needed before a transition.

The recent Brown Brothers Harriman Private Business Owners Survey reveals that while 91% of business owners want to keep their companies in the family, many struggle with succession planning. Nearly three-quarters have not clearly defined or communicated the roles of the next generation, and 29% are uncertain about choosing a successor. Emotional attachment to the business also complicates decisions, with 45% unwilling to sell due to identifying too closely with their companies.

Owners face challenges such as unequal inheritance, funding estate taxes, and ensuring financial support for retiring founders. Many assume their children want to take over the business, often leading to disruption in succession plans when that isn’t the case. The survey highlights the need for early and clear communication about expectations, ownership, and control to prevent family conflicts and ensure smooth transitions.

Finally, fears about NextGen’s ability to handle wealth responsibly and maintain the company’s mission are common among business owners. These concerns emphasize the importance of setting up proper boundaries, fostering open discussions, and aligning values between generations to ensure the long-term success of the family business.

Want to read the full article on WealthManagement.com? Pros and Cons of a Living Inheritance