Borrowed from Your Grandchildren

CHAPTER 12The Family Constitution: Governing Document of the Generative Family

A generative family is a huge endeavor. It brings together many people and a portfolio of businesses and financial ventures. It can contain a foundation, family office, vacation houses, and hold an important role in the community. Its reach is often global. The family can have multiple ownership agreements and several trusts, each with an operating document. It can contain multiple boards, a family council, and an owners' group. It convenes periodically as a whole family, has task force and committee meetings, and offers education programs for the next generation. And at its center, legacy values and mission statements from older generations that define the family's purpose, identity, and commitments. Even those in the center find it hard to track and absorb all of these agreements.

Where does someone go to discover or consult the rules of the game, the operating principles and practices for how this huge entity works? Nearly all generative families create some sort of guiding document that clearly sets forth these values, policies, and practices. It expresses, definitively and clearly to everyone, what the family does, what it stands for, and how it organizes its family and business governance activities. This chapter looks at the nature and development of this family constitution.

Constitutions outline the shared policies and understandings that family members are expected to adhere to. Each adult ...