Business succession can be a difficult subject, especially when conversations about the transfer of wealth and responsibilities are between family members. That is why many family businesses turn to a trusted advisor who can act as a non-biased expert who can facilitate and guide the conversation and help chart a path forward.
“If you’re a business owner, the most important thing is to have a discussion in advance, whether that’s with your family, your employees, your management team, or anyone that’s interested in taking over,” says Jamie Golombek, managing director of tax and estate planning at CIBC.
Mr. Golombek adds that some forward-thinking business owners begin their succession planning from day one, but most start to have those conversations about a decade before they intend to retire.
“Don’t leave it to the last minute, and if you’re not familiar with how things work, bring in an expert facilitator.”
A trusted advisor can guide business owners through the process of sharing their plan with family members, providing a structure for conversations that can be complicated by family dynamics. Like Mr. Vecchiarelli, who has worked with three generations of the Sopuch family, an advisor can help educate younger family members so they feel confident about their future roles in the business.
An advisor can also assist business owners as they navigate the sometimes-challenging task of deciding who will inherit what, says Mr. Vecchiarelli. For example, it can be a challenge to figure out how to handle wealth transfer when one child is involved in the business while the other is not. How can you ensure each child is treated fairly when it comes to wealth transfer?
While Dan Sopuch isn’t thinking about retirement any time soon, he says he knows that balance will be something to consider in future when deciding how to divide his estate between his two sons. His eldest son, Chris, “always knew” he wanted to be a farmer and will inherit Marshland Gardens someday, while Dan’s younger son, Nicholas, has successfully pursued a different career path in the tech industry in London, UK.
Dan says that his father Paul didn’t discuss estate matters with him until his late 80s, but he has learned from that situation and plans to have the conversation with his children earlier in life.
Mr. Vecchiarelli says his broader advice for individuals facing these sorts of issues is to be as transparent as possible. Having discussions early on, with the help of a trusted advisor, can enable younger family members to express their own interests around the business and ensure everyone is on the same page.
