The Center for Family Legacy at Truist Wealth advises on family governance, which it defines as the process of making joint decisions about family wealth, values, and shared assets.
Samantha Vassallo, managing director at Truist Wealth has worked closely with the Community Foundation to serve her clients. She is also a member of the foundation’s Philanthropic Advisory Council.
“Truist offers a hyper-local, VIP customer service that’s unique,” said Mary Katherine Morales, vice president for philanthropic services at the Community Foundation. “We work well as partners to bring the most value to their clients as they consider what kind of charitable legacy that they would like leave, and the impact that they can have for generations.”
Only 10 percent of families are able to keep wealth past the third generation.
Researchers point to poor communication, lack of trust, and unprepared heirs as common reasons why wealth does not last.
“Family governance embraces joint decision-making,” Vassallo said. “It is about how families work together to manage wealth, prepare heirs, and preserve a mission.”
According to the center, private wealth is the money or business assets a family owns. Family wealth, however, includes financial capital along with human capital — the family members themselves — and intellectual capital, which is the knowledge they hold.Families that prepare the next generation and create clear rules are more likely to sustain wealth. That includes mentoring, education, and creating written policies for how family members interact and make decisions.
Vassallo recommends that families begin governance by focusing on shared values and creating a mission statement. A mission statement defines a family’s purpose, values, and goals.
Shared values give meaning to wealth and help members agree on a vision. By building a values-based mission, families can align future planning and create guidelines for decision-making.
Holding family meetings can provide an open forum for communication. These meetings often include an agenda, a neutral location, and a facilitator to guide discussion. Families who follow this process can improve teamwork and give all members a voice.
- A family council, which handles communication, values, and planning.
- A family assembly, which includes all members and provides education and connection.
- An executive committee, which manages confidential financial matters.
- A family board, which oversees legal entities, trusts, or business assets.
The choice of structure depends on the family’s size, assets, and goals. Some families use more than one.
As families grow, decision-making becomes more complex. A first-generation wealth creator may make all choices, but later generations require shared systems. Families may shift from one leader to councils or committees to balance participation.
- A decision-making policy to guide how consensus is reached.
- A code of conduct for how members treat each other.
- A conflict resolution policy to address disputes.
- A risk management policy covering insurance, estate planning, or other protections.
Another important aspect to preserve family well is the need to prepare heirs. That includes teaching financial literacy, supporting entrepreneurship, sharing philanthropic visions, and mentoring young leaders.
Education also involves discussing the emotional effects of wealth. Open talks about money and its impact can prepare future generations for leadership and reduce stress, the report said.
Succession planning should align with the family mission and charitable passions. Families are urged to consider who will take on leadership roles and how to prepare them.
Good family governance improves communication, reduces conflict, and builds stronger heirs. Families that focus on shared values, mission, and governance structures are more likely to sustain wealth for generations.
