“Family days strengthen cohesion”

The first time they meet, some people still have reservations, but then they happen again and again. In an interview, customer advisor Kerstin Rasch explains the background and significance of family days. She talks about possible topics, how to deal with conflicts – and the need for organizational framework conditions.

You organize family days together with your clients time and again, Ms. Rasch. What are these meetings about?
Family days are primarily about strengthening cohesion within the family. Often, subsequent generations are to be more involved or introduced to tasks. In some cases, however, the families also talk about fundamental issues. For example, about family assets or how the family would like to position itself in the future, make decisions or resolve conflicts. We help organize and moderate these days, which couldn’t be more different.

What are the reasons for this?

There can be many reasons. The size of the family alone plays an important role here. Or the increasing distance from the founders of the family fortune – often entrepreneurs. Sometimes the founding generation wants to successively hand over responsibility to the children, sometimes it is already a matter of transition from the third to the fourth generation or even further. As a rule of thumb, the further away we are on the timeline from the founder, the less the company is in the foreground these days.

In these cases, there are certainly more family members as well….
Indeed. It used to be clear that one of the children would later run the company. In some cases, it was just a question of who it would be. Today, it’s no longer so clear. Some of the next generation has completely different ideas and goals and perhaps would rather realize their own potential.

What else has changed?

The spatial situation is often different. In the past, large parts of the family lived near the company headquarters. Today, it’s always across national borders, which can make it more difficult to convey a family mindset that’s about shared values. Days like this are good for that, too.

How often do family days take place?

That depends on the goals we want to achieve together with our clients. Depending on the situation, we recommend one to four Family Days per year. As a rule, families meet twice a year.

Which type of family day is the most fun?

(laughs) So far, all of them have been fun. Two types of family days are certainly particularly exciting. One is when the younger generation has not yet been informed about fundamental issues, or only a little. For example, about how large the assets are. In these cases, we take over the communication and training, often together with the parents and, depending on the focus of the topic, also with other trusted third parties such as the tax advisor. This makes it easier for everyone to get involved in the topic.

And secondly?

Family days that take place without the parents. The children are then allowed to ask any questions that they might not dare to ask in the presence of their parents. For example, because they don’t want to admit that they are not very familiar with a topic.

But then these two types of family days are not the rule?

No, although the differences here are really quite large. It starts with how formal – or informal – the day should be. We often go out for dinner with the family the night before. On the following day, we can discuss questions about assets or what the family structure looks like or should look like.

The range of questions about assets alone is likely to be wide …
Indeed. It can range from the basics, such as what stocks and bonds are, to complex topics. For example, what constitutes a strategic asset allocation and what was worked out with the family in a specific case. Or training the family members on illiquid asset classes such as real estate, private equity or private debt.

How long does such a family day last?

There are big differences there, too. Most recently, for example, it was five hours. It is very important not to overwhelm the audience. Details can then be explained in follow-up meetings. The fact that bond prices fall when interest rates rise is always a pitfall. But questions about voting rights in a family business can also be difficult. And what happens in the event of an inheritance? What about the saleability of shares?

How often does the issue of sustainability play a role?

This question is being asked more and more frequently, especially by the younger generations. Whereby there are also two different topics here. They were probably thinking about sustainability in terms of investing money. But at least as often it is a question of developing a sustainability strategy – for the family or the company. The first step is always to discuss within the family what sustainability actually means to them.

There could be different opinions on this …
You are right. The topic is usually put on the agenda by the younger generation. As a rule, however, the family members agree on a basic understanding quite quickly.

How does a family day end?

(laughs) Usually in a good mood. But I’m sure you meant something else. The important thing is that it ends with the family having developed a common understanding of individual topics or, to put it another way, that a result or at least partial result has been achieved. With so many topics discussed, it is also important that certain formalities are observed. This is helped by a protocol, which is written and sent out again to the round and must be approved by all.

A protocol? So far it has sounded quite relaxed …

It often is. However, family days are far from sitting down and being sprinkled around a bit. These days are a lot of work, for everyone involved. It starts with sending out invitations in time. It’s about preparing content. It’s about giving decision templates to the round. It often makes sense for the younger generation to take over part of the organization: Whether this is of a technical or more organizational nature is not decisive. Here, too, we as a family office provide support.

Are family days on the increase?

Definitely. Before the first family day, there are still considerable reservations in some cases: a family work meeting? Is that really necessary? But in the end, everyone is glad that the Family Day took place – and is already looking forward to the next one.