I was speaking with a long-time acquaintance with whom I went to high school. He is a third-generation member of a family business. He mentioned that his family has an ongoing policy, starting when the family’s children become teenagers. If any of them ‘think’ they want to go into the family business, they are expected to attend the annual family-business meeting.

The teenagers sit on the side of the room. They see who are the current and future leaders. They become familiar with the family’s vision for the business. They absorb the family’s values and begin learning what is expected from family members active in the business.

Writing on family-business policies, Craig Aronoff[1] describes them as the guides for decision making and defining relationships between the family and the business. Good policies help families build skills, gain confidence, and increase their ability to face issues together. The policies should emerge from the bedrock of the family’s values, beliefs, philosophies, and principles.

Most family businesses do not survive past their third generation. The policy put in place by my high-school friend’s family has not only helped bring them securely into the third generation, but it looks good to take them into the fourth and beyond; a real-life illustration of the merits of solid family-business policies.

[1] Craig Aronoff, Joseph Astrachan, & John War. Developing Family Business Policies. Family Business Consulting Group.