Family governance: a practical starting template for new principals
A documented starting point for families establishing a governance structure: charter, council, meeting cadence, and decision rights.
Governance sounds bureaucratic until a decision goes wrong. Then it becomes the structure that prevents the next mistake. This note is a practical starting point for families establishing a governance structure for the first time.
The four documents
We recommend four documents at the outset. None needs to be long; all need to be written.
Charter. One page. States the purpose of the family’s wealth, the time horizon, and the principles that govern decisions.
Decision rights. A matrix that sets out who decides what. Investment allocation, distributions, and the appointment of advisers should each have a named decision-maker and a documented escalation path.
Meeting cadence. How often the family meets, what is on the agenda, and what is minuted. We recommend twice a year for the full family, quarterly for an executive committee.
Reporting. What information is shared with whom, and how often. Transparency is a choice; the right level depends on the family.
Common failure modes
The most common failure is a charter that describes aspirations rather than decisions. A charter that says “we value long-term stewardship” is a slogan. A charter that says “investment decisions are made by the investment committee against the written policy, with distributions reviewed semi-annually” is a governance document.
The second most common failure is a meeting cadence that collapses under the weight of the agenda. Meetings should end with a written list of decisions, owners, and dates.
Where we help
We do not write the charter for the family. We facilitate the conversation that produces it, document the result, and review it annually against actual decisions made.
For information only. Not investment advice. Past performance is not a reliable guide to future returns.