All businesses face risk, but when it is your family firm the consequences of something going wrong can be personal as well as commercial. It is important to think about business risk management ensure you have processes in place. Contact our business risk management team
When you own and run your own family business there tends to be a number of family members involved in the ownership and control of the business. You need to consider how this impacts the way the business manages risk. There are many different factors to consider in business risk management, including financial, performance, reputation, safety and relationship. Relationship risk tends to need more of a consideration in a family business. It will include the potential for solidifying or weakening trust between non-family employees, customers, suppliers and other stakeholders, as well as strengthening and weakening trust within the family – and the impact of that trust on legacy.
When talking about ‘risk’ we tend to think of danger, but risk also offers opportunity and it is important to really understand the difference. Talking about risk in a family business, including the different levels of risk each family member is prepared to take, can be an emotional subject. We understand this when giving family business advice and its why it is important to have proper procedures in place to ensure risk is managed effectively.
Sometimes families think keeping the business in the family is less risky. Bringing a non-family member onto the board or as a shareholder could be a positive move. In this podcast Chartered Financial Planner, Greg Harris, talks us through the stresses of inheritance planning and how you can set things up in way that takes care of your loved ones after death. When it comes to business continuity we don’t like talking about death and we take a look at how to open up dialogue with loved ones and colleagues so you can plan a tax efficient way for wealth to be distributed and ensure the longevity of the business for your clients. Contact Unividual to see how our family business financial planning and risk management could help you.
The most important thing is to ensure risk management is part of the overall business plan, and that there is a framework for identifying and discussing risk within the business. There should also be a formula for measuring risks so they can be identified and addressed if things change. Not only do we live and breathe family business at Unividual, which is run by two generations of the Baxter family, but we’ve worked with many different family-run companies over the last 20 years, in the area of family business financial planning. Each business is unique and has different circumstances and structures, and at Unividual we have the empathy and ability to listen, understand and mediate for each unique company. This gives our family business advisers the experience to navigate complicated and intricate areas that link up with each family member’s business and personal finances.
