All parents worry about the next generation but for high-net-worth families there is an extra set of issues which surround succession, how their children deal with significant wealth and the responsibilities that come with it. Many families spend a lot of time considering trusts and inheritance structures but is enough time spent thinking through more foundational issues? Issues which could make the succession more successful and help the next generation avoid the pitfalls that can be found in the challenging and changing world they live in.
Decision making
How we live our life is determined by the decisions we make. They have consequences for us and for those around us, for the present and for the future. They define what we do, our level of contentment and the quality of our relationships.
There are a lot of factors that make up a successful decision but amongst the biggest are self-awareness, values and purpose.
The next generation are making decisions all the time that affect them, their family (and its reputation), the continuation of wealth from one generation to the next and their impact in the world. But how self-aware are they, how well do they know their values and understand their purpose?
Self-awareness
Self-awareness is having a clear understanding of who you are, your strengths, weaknesses, values, beliefs, motivation, emotions; what makes you tick. It’s about knowing your purpose. It allows you to understand other people, how they see you and how you react to them. Being self-aware is the first step in mastering ‘who you are’ and ‘doing what you truly want to do’. If these two do not match, there is dislocation which affects behaviour and outlook.
Jack Green is an athlete who competed for Great Britain in the London 2012 Olympics. The previous year, at the age of 19, he had become one of the youngest ever under-23 European athletic champions and was expecting great things from the Olympics. However, he hit a hurdle in the semi-final, crashing out. Fuelled by anger he ran the leg of his life in the 4x400 metre relay, missing out on a medal by one-tenth of a second. Within a few months of the Games finishing he was facing a very tough time in his life, describing it as being “hell”. During this time Jack Green watched The Marinovich Project, a documentary about Marv, a former pro-American football player, and his son Todd, who Marv dedicated his life to turning into a National Football League (NFL) superstar. Todd became an outstanding quarterback and realised his father’s dream and played in the NFL — but at a cost: Todd’s life was destroyed by substance abuse. During that documentary Todd observed: “just because you are good at something doesn’t mean you have to do it.”
Speaking to The Sunday Times, Jack’s comment on this is interesting: “I’m meant to be one of the most talented athletes around. Does that mean I have to do it? In my opinion, no.” He went on to acknowledge that “I’m not sure I ever enjoyed running,” and admitting that “I’ve just been wearing a mask.” I wonder how many of us wear a mask, and how many of the next generation are doing so?
This is an example of the dislocation between ‘who you are’ and ‘what you do’, where what we are good at determines what we do without regard for who we are or what matters most to us.
The importance of values
Values are beliefs or principals which guide behaviour, they define who we are and affect everything about us — they have consequences. For example, one of our values might be honesty; the truth is important to us and impacts our conversations and relationships at every level. Compassion may not be a value for us, in which case we are not concerned by the impact of our actions and words on others.
For the next generation there are three important things to know:
l What are my values? If you do not know what they are, you are not in control of one of the biggest determinants of your behaviour
l Do I like my values? Letting the wrong values guide your behaviour can be destructive of yourself and of those around you
l Do my values and behaviour align? When they do there is increased contentment, when they do not there can be confusion and guilt, a lack of inner peace which itself can have behavioural consequences. Wealth in a void of values can be destructive to the next generation and to the family.
The role of purpose
Purpose gives direction and adds meaning to all we do; we go through life more confidently. We are more likely to know what it is that we want to do and avoid having to wear a mask. For some, having a purpose means working towards something larger than ourselves. Having a purpose gives us energy and drive.
Without purpose three things can happen:
l We do what we don’t want to.
l We do what we perhaps shouldn’t.
l We can head in the wrong direction.
Significant wealth brings both opportunities and dangers. Without purpose it is more difficult to make the most of the opportunities and easier to fall into the dangers. It is also more difficult to realise the responsibilities one has.
The impact of coaching
One of the ways to increase the next generation’s self-awareness, help them understand their values and discover their purpose in a lasting way is through ‘coaching’. Coaching is not about ‘telling’. It is about skilful questioning and challenge. Coaches know how to create environments were quality thinking takes place and get people to think more deeply than they have before. The increased self-awareness, understanding of values and purpose is grounded in the practicalities of the next generation’s lives and change takes place.
Successful succession may not look the same for all high and ultra HNW families but a generation that is better equipped to make decisions is more likely to succeed. Coaching makes it possible.
