the wesley group cfsps presentation
TRANSCRIPT
Many family leaders prepare the money for the family.
An exceptional few prepare the family for the money.
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© 2011. The Wesley Group. All rights reserved.
It has left me with nothing to hope for, with nothing definite to seek or strive for. Inherited wealth is a real handicap to happiness.”
William K. Vanderbilt, grandson of Cornelius Vanderbilt
“
The Vanderbilts over several generations united two notable talents, those being the acquisition of money and the later the dispensing of it in unparalleled volume, and for frequent and unparalleled self-gratification and, very often, rather forthright stupidity.”
John Kenneth Galbraith
“
It requires a great deal of boldness and a great deal of caution to make a great fortune; and when you have got it, it requires ten times as much wit to keep it.”
Nathan Rothschild
“
It requires a great deal of boldness and a great deal of caution to make a great fortune; and when you have got it, it requires ten times as much wit to keep it.”
Nathan Rothschild
“
• Alphonse James de Rothschild (1827-1905) • Bethsabée de Rothschild (1914-1999) • Charles Rothschild (1877-1923), banker and entomologist • Edmond James de Rothschild (1845-1934) • Elie de Rothschild (born 1917) • Emma Rothschild (born 1948) • Guy de Rothschild (1909-) • Baron Ferdinand de Rothschild (1839-1898) • Hannah Primrose, Countess of Rosebery nee Hannah Rothschild (1851-1890) • Henri James de Rothschild (1872-1946) • Henriette Rothschild (1791-1866) married Sir Moses Montefiore (1784-1885) • James Mayer Rothschild (1792-1868) • Jean-Pierre de Rothschild ("JP") (born 1960) • Josef Rothschild • Kathleen Annie Pannonica Rothschild (Baroness Nica de Koenigswarter) (1913-1990) • Leopold de Rothschild (1845-1917) • Lionel Nathan Rothschild (1808-1879) • Miriam Louisa Rothschild (1908-2005) • Lionel Walter Rothschild, 2nd Baron Rothschild of the United Kingdom (1868-1937) • Nathaniel de Rothschild (1812-1870) • Nathan Mayer Rothschild (1777-1836) • Nathan Mayer Rothschild, 1st Baron Rothschild of the United Kingdom (1840-1915) • Nathaniel Charles Jacob Rothschild, 4th Baron Rothschild of the United Kingdom (born 1936) • Nathaniel Mayer Victor Rothschild, 3rd Baron Rothschild of the United Kingdom (1910-1990) • Philippe de Rothschild (1902-88)
90%98% is gone by the end
of the fourth
is gone by the end of the third
70% of wealth is gone by the end of the second generation
The Fears
37% Investment risk
26% Systemic economic risk
16% Political and tax risk
7% Family issues
Family Office Exchange
The Reality
60% Communication and trust
25% Inadequately prepared heirs
15% Lack of mission
3% Technical failures
Williams and Preissser (2003)
Mile 1: The Stages of Family Development
Mile 2: Understanding Family Wealth
Mile 3: Developing a Family’s Core Competencies
Mile 1: The Stages of Family Development
Mile 2: Understanding Family Wealth
Mile 3: Developing a Family’s Core Competencies
HUMAN FINANCIAL
CULTURAL SOCIAL
The Focus: Four Types of Family Capital
Each generation is maximizing its potential.
HUMAN FINANCIAL
CULTURAL SOCIAL
The Focus: Four Types of Family Capital
Assets are protected and wisely used.
HUMAN FINANCIAL
CULTURAL SOCIAL
The Focus: Four Types of Family Capital
The family has a healthy and productive culture.
HUMAN FINANCIAL
CULTURAL SOCIAL
The Focus: Four Types of Family Capital
The family is well-advised and well-connected.
HUMAN FINANCIAL
CULTURAL SOCIAL
The Focus: New Model of Estate Planning
Investment of some financial capital in structures that will foster human, cultural and social capital of the family
Mile 1: The Stages of Family Development
Mile 2: Understanding a Family’s Core Wealth
Mile 3: Developing a Family’s Core Competencies
Core Competencies
1. Alignment & Identity
2. Communication
3. Autonomy and Belonging
4. Performance & accountability
5. Sound financial management
6. Effective structures
7. Robust networks and ecosystems
8. Leadership and governance
9. Education & mentoring
10. Cultural agility & adaptive capacity
Outcome
Situation
Now
StructuresFunctions
Family TypeRolesCoalitionsPatterns
History
People Patterns
PsychologyEducationExperience
HonestyEngagementCommitment
Family Systems Diagram
Developmental Stage
BelongingIndividuationTrustPower
Stories Scripts
Communication
Outcome
Situation
Now
StructuresFunctions
Family TypeRolesCoalitionsPatterns
People Patterns
PsychologyEducationExperience
HonestyEngagementCommitment
Family Systems Diagram
Developmental Stage
BelongingIndividuationTrustPower
Stories Scripts
Communication
History
Every man takes the limits of his own field of vision for the limits of the world."
Arthur Schopenhauer
“
Outcome
Situation
Now
StructuresFunctions
Family TypeRolesCoalitionsPatterns
People Patterns
PsychologyEducationExperience
HonestyEngagementCommitment
Family Systems Diagram
Developmental Stage
BelongingIndividuationTrustPower
Stories Scripts
Communication
History
Outcome
Situation
Now
StructuresFunctions
Family TypeRolesCoalitionsPatterns
People Patterns
PsychologyEducationExperience
HonestyEngagementCommitment
Family Systems Diagram
Developmental Stage
BelongingIndividuationTrustPower
Stories Scripts
Communication
History
Outcome
Situation
Now
StructuresFunctions
Family TypeRolesCoalitionsPatterns
People Patterns
PsychologyEducationExperience
HonestyEngagementCommitment
Family Systems Diagram
Developmental Stage
BelongingIndividuationTrustPower
Stories Scripts
Communication
History
Challenge the sense the family is making of itself…
ReframingMoving Boundaries
Shifting FocusDisrupting Cadence
Altering StructureDisturbing Balance
Help the family tell a larger story about itself and thereby create a new identity.
It’s simple in theory….
Transcendence
Self-Actualization
Knowledge & Understanding
Esteem & Respect
Love & Belonging
Safety & Security
Survival
World View
• Survival
• Safety & Security
• Love & Belonging
• Esteem & Respect
• Understanding
• Self-Actualization
• Transcendence
Philanthropic Values & Motives
• Security, preservation
• Tradition, care, responsibility
• Belonging, identity, tribes
• Power, impact, competence
• Engagement, productivity, leverage
• Growth, synergy, experimentation
• Interdependence , transformation
World View
• Survival
• Safety & Security
• Love & Belonging
• Esteem & Respect
• Understanding
• Self-Actualization
• Transcendence
Family Stages
Entangled, Separating
Separated
Gathered
Flowing
Generative
In my world philanthropy becomes a lever to do two things….
2. Help families
move from one stage of development to the next.