Family Constitution

WHAT IS A FAMILY CONSTITUTION?

A Family Constitution is typically a confidential document entered into by the members of a family, and can be anything from a simple, non-binding guideline as to how the family should govern itself to a legally binding complex framework on how the family assets and businesses are to be managed. The main goal of a Family Constitution is to define common values and objectives of the family, as well as provide a framework for joint decision making and effective mechanisms for managing family affairs and solving potential conflicts. A well drafted Family Constitution may introduce transparency and good communication, building trust and ensuring a harmonious and successful family cooperation.

WHO SHOULD CONSIDER A FAMILY CONSTITUTION?

A Family Constitution is a document between family members and as such can be particularly beneficial for families who own or manage substantial wealth or who run family businesses.

It should be noted however, that a family constitution may not be the most appropriate tool for every family, particularly where there are severe disputes existing between the members or where there is the ultimate intention to sell the family assets or business(es). At Main Partner Trust, we may help you understand if the family constitution is suitable for your individual case or guide you to the possible alternate solutions in the case that it is not.

TIMEFRAME TO DEVELOP A FAMILY CONSTITUTION

The timeframe involved in preparing such a document will ultimately depend on the amount of information to be included therein and the time required from the family members to form a consensus. It is preferable that the family sets itself a deadline for agreeing the first version of such a document to ensure that they keep momentum, making it more likely that family members keep interest and ultimately finalise the document.

HOW CAN WE HELP?

Our dedicated team at Main Partner Trust can facilitate a meeting with you and your family members in order to understand your overall vision and objectives and to determine if and how a family constitution can work for you.

Main Partner Trust specialists can be by your side assisting with the entire process – from facilitating meetings with you and your family members and proposing and drafting the Family Constitution to assisting, if needed, with the incorporation of the provisions of the Family Constitution into any relevant shareholders agreements or articles of association.