Family governance
How a family makes decisions about shared wealth, and how the arrangement survives its founder.
Governance is the least urgent item on any family’s list and the one whose absence causes the most damage. It is the set of agreements about who decides what, how disagreements are settled, and how the next generation is prepared to hold what it will inherit.
Ownership and management are different questions
A family enterprise contains three overlapping groups: the family, the owners, and the people who run the business. An individual can belong to one, two, or all three, and most family disputes are the result of a question from one circle being answered in another. The purpose of governance structures is to give each question its own forum.
A family council is that forum for the family as owners: a defined membership, a regular schedule, an agenda, and a record of decisions, deliberately separate from the board of any operating company.
The constitution is written while the founder can explain it
A family constitution states how the family will govern its shared wealth: the values it is held under, who participates, how decisions are made, how members enter or exit shared assets, and how disputes are resolved. It is generally not legally binding in itself and works through the authority the family gives it and through the legal documents drafted to reflect it.
In Nigerian families it usually has to address questions otherwise settled by seniority and assumption: whether in-laws participate, how children of different mothers are treated in relation to shared assets, whether family members may work in the business and on what terms, and what happens when one branch wants liquidity and another wants to hold. Settling these while the founder is present and able to explain his reasoning is considerably easier than settling them afterwards, alongside grief.
Nigeria: the generation that will inherit has not been told anything
Wealth is often not discussed within Nigerian families until an estate is being administered. Heirs then meet the structure, the advisers, the business, and the obligations simultaneously, at the worst possible moment, and frequently in the middle of a dispute about the same assets.
The alternative is gradual and unremarkable. A young adult who has attended a family council, met the advisers, understood the difference between the family home and a producing asset, and watched a plan being reviewed will make better decisions than one handed a portfolio and a condolence card in the same week.