COPPERTREE LTD - Your Unique Path

Creating Value Through Your Family’s Philanthropy

We understand that discovering one’s path in life and achieving independence from the Family is a balance of two forces. The first one is the force of togetherness. There is much comfort in remaining bonded with the Family but too much togetherness can contribute to dependence and lack of self motivation. The other force is independence. Too much independence can result becoming distant and estranged from the Family. Coppertree recognizes that there can be a balance between discovering your own path and remaining a vital part of the Family’s legacy. Understanding each person’s role as part of the Family’s system can be a helpful way to understand the dynamics that are currently in place.

Part of achieving the balance between togetherness and independence, is deciding what your unique path is. What do you want for yourself? These are the questions that emerge as a part of the Smart Planning Process ™.

Understanding the history and unique story of a family helps us understand the template that shaped the family’s values, thoughts, and experiences. It also gives us a view as to how those values were passed down through the generations. In many cases, the formation of the family enterprise is a very large part of the family story. We guide each Family to understand its unique story, and use that knowledge to gain understanding of how the family functions in terms of their present relationships. Family dynamics influences almost every aspect of life, including decisions that affect the Family’s resources. Knowledge of how the emotional system operates in one's family, work, and social systems reveals new and more effective options for solving problems and resolving conflicts.

This becomes especially clear in times of stress such as family or family business leadership succession. The primary reason that 80% of family businesses fail after the second generation is that the succession process was not handled successfully.

How does a Family with a business or a Family in general make the tough decisions without causing stress? How do we all get along? These are questions we are often asked.

Please read on for examples of issues that many Families’s face in the journey to remain together as a Family while being good stewards of their Family enterprise.

Managing The Dynamics of Transitions within a Family Business

William is the founder and CEO of a mid-size business that he started over 40 years ago. He is preparing to turn the every-day management of the company over to his two sons. They have been involved with the family business since they graduated from college. In that time, the business has grown from a small manufacturing firm with 4 employees, to an international business that currently employs more than 300 people.

William is proud of the fact that he has built a legacy for his family and that his sons are interested in stewarding his vision of the business serving as an economic resource for the family. Both sons are presently in leadership roles and have expressed interest in succeeding their father as the next business leader. However, the family does not have a process in place to ensure that a smooth transition will occur. With no one to turn to William feels that any decision he makes may appear as a slight to the son that is not chosen. He has delayed retirement because he dreads having to make the choice.

The Coppertree Response:

Coppertree asked William to articulate what he ultimately wanted for his family and for the business. He answered that he wanted his family to live in “Harmony”. His hope was that his sons would also embrace his desire of maintaining family harmony as the basis for which important decisions would be made in the management of the company. It was also important to him that each successor generation knew that he built the business as a vehicle for the family to flourish and grow. Equally important, he wanted the enterprise to be a resource for his family to enjoy a well-lived life for many years to come.

Coppertree advised William’s family to establish a family governance system and to form a family council to serve as the voice of the family. With Coppertree’s guidance, the family developed the framework for its governance system and summarized it in a family charter. The charter outlined the process for decision-making and guidelines by which milestone issues such as succession and financial education would be addressed.

They agreed to hold Family Council meetings four times a year. The family would also conduct an annual meeting for all family members. Each of these gatherings would be a forum to steward the family legacy through an understanding of how the family story impacts the dynamics of present and future generations. William’s spirit of “Harmony” would serve as the foundation from which all decisions would be made.

With each family member’s voice being heard, the next business leader was chosen by the family, relieving William of the anxiety he had in having to make this decision by himself. Of greater value, William’s family now has a mechanism in place to foster his dream of family harmony.

Coppertree also assisted the family in the formation of an advisory board to serve as the voice of the business. The advisory board gave William an opportunity to continue to be involved with the business and to use his unique talents and experience following his retirement. William retired as the family business leader and continued his journey as the advisory board chair.

The family continues to work with Coppertree as they strive to perpetuate their legacy of harmony and to create a great future for generations to come.

SMART Planning for a Well-Lived Life

Following the sale of their business, Mike and Angie were feeling overwhelmed with what to do next. Should they invest the proceeds? Should they use some of their windfall to form a family foundation? Should they be transitioning this wealth to their children and eventually their grandchildren? Longer term, they wanted to have a resource management plan in place that would help their family flourish well into the future.

The Coppertree Response:

Mike and Angie met with Coppertree to help them address the three questions they wanted to consider. What do they want for themselves and their family? What could they learn from their family story to better understand the connection between their ancestral values and the present dynamics of the family? How will the family use their resources to attain happiness, achievement, significance, and legacy?

Coppertree guided Mike, Angie and their children through the SMART Planning Process™. The process produced Success Maps™ for each member of the family that articulated what a well lived life would look like to them as individuals and as a family. At the top of Mike and Angie’s Success Maps was their commitment to support their children while they pursued their education as well as their own dreams.

Using what was shared, Coppertree worked with the family to establish a strategy on how best to use their personal resources (time, knowledge, experiences, connections and economic resources) in pursuit of their vision for the future. The strategy would be used to form annual action plans and a longer term Continuity Plan to perpetuate the family’s legacy for many years to come.

Coppertree also assisted the family’s trusted advisors to ensure that an integrated response was provided to meet the family’s needs. The advisors were able to coordinate their efforts by using the family’s SMART Plan™ as a guide. This enabled the family’s advisors to work together in crafting solutions that included multi-disciplinary expertise in areas such as estate planning, wealth management, risk management, and tax planning and compliance.

Mike and Angie were able to reach a new level of understanding towards what they wanted to accomplish in life after owning the business. By participating in the process, the children understood what their parents wanted and why. They were also able to articulate to their parents what they wanted to accomplish and why.

Coppertree continues to work with the family on the implementation and execution of their newly formed family strategy. Periodically, Coppertree also meets with family members to ensure that each family member’s Success Map™ reflects what matters most to them in an ever-changing world. With Coppertree by their side, the family is confident and content with what life holds for them as they strive to create a great future.

Managing the Family Balance Sheet

Managing the family’s personal business and financial affairs had become a task that Alex and Marie dreaded. Trying to make sense of the complexity and scope of their interests required many hours of review and analysis of monthly and quarterly reports for the couple. Furthermore, they were no longer comfortable with the thought of having to make decisions on their own as the contemplated the wide array of issues they would need to address in the years ahead, including the eventual decision about what they should do with their business.

Alex and Marie were very grateful for the expert advice they had received over the years from their attorney and their accountant on their legal and tax-related considerations. The couple had come to realize it would be beneficial to expand their team of advisors to include a personal CFO that could integrate the execution of their wealth management strategy, tax strategy, wealth transition strategy, philanthropic interests, and personal services.

How could they gain the clarity they needed while maintaining control of their affairs?

The Coppertree Response:

Alex and Marie were referred to Coppertree by their accountant. During the meeting Alex explained what they wanted. It was important that Coppertree could serve as an advocate for the family’s best interests, providing a personalized focus and control over the family’s finances. They also expressed an interest in formalizing the reporting and communication process between the family and the various professional services advisors.

Since Marie was aware that Coppertree served multiple families in similar capacities, she asked if this could provide them with cost control advantages and if they might benefit from economies of scale. She also asked about Coppertree’s ability to work with their children in providing educational opportunities to prepare them for their future roles in managing their own financial affairs as well as that of the family. The Coppertree Team assured Marie that they would strive to manage costs and negotiate the best terms possible from their service providers and that they would gladly work with each generation of the family.

Coppertree was engaged to serve as the family’s personal CFO. The process began with the identification of the family’s objectives and priorities. Then, the Coppertree Team began the process of assembling all available information pertaining to the family balance sheet and income statement. Each component of the family’s financial plan was also documented such as distribution schedules, projected capital call dates, adjustments to cost basis, trust distributions.

Coppertree continues to work with Alex and Marie’s family, providing them with the information they need on a monthly basis to keep the family apprised of their interests. The family now has a greater sense of clarity and comfort in knowing that Coppertree is maintaining a close watch on their affairs as they strive to create a great future.