As a part of traditional onboarding procedures, employees receive an employee handbook or manual to read, sign and date. This handbook typically contains information about company policies and procedures. It is presented to employees once they are hired.
In a family-owned business, a Family Guidebook or Family Constitution is developed to prepare for the potential hire of family members into a business. It also clarifies compensation and performance expectations while working in the business and addresses potential exit from the business. Essentially, the Family Guidebook creates the framework around all family rules for the business.
Having a written Family Guidebook provides clarity around difficult questions such as:
A Family Guidebook is typically created in collaboration among the current family leaders working in the business. It is also recommended that you consult outside advisors when developing any legal documents such as pre-nuptial agreements or wills.
Having clearly written policies and procedures that specifically address how one prepares to enter a family businesses, work in a family business, and exit the family business (terminated, voluntary or through planned transition) provides the best mechanism for family capital management.
Fill out the form below for more information about creating your Family Guidebook and to request a sample Family Guidebook.