What is Family Governance & Education?
Family governance and education are two key and related components of an effective family office. They serve as the foundation for responsible stewardship of wealth, preservation of family values, and transmission of wealth from one generation to the next. These services help ensure that families flourish across generations.
Failure to pass wealth from generation to generation usually stems from a breakdown in trust rather than poor legal structures or wealth management. Thus, family governance and education fill an essential role by helping families articulate their shared values, goals, and objectives, and ensuring that everyone is aligned in terms of their vision for the future.
Family Governance
Family governance refers to the structures, systems, and processes that families use to manage their wealth and decision-making. It can include both the formal decision-making structures (such as the Board of Managers of a Private Family Trust Company), or informal ones (such as a Family Assembly). The complexity of the family will determine what level of governance it needs to decisions to build the family’s wealth.
Family Education
Education is how governance becomes part of who the family is. It provides family members with the knowledge and skills necessary to effectively manage their wealth and make informed decisions about their financial future. This includes education about financial literacy, investment strategies, tax planning, and estate planning. It also includes education about family values, communication, and conflict resolution, which are critical for maintaining strong family relationships.
Building Wealth
A family Governance and Education develops the family’s qualitative wealth. Wealth is not just the family’s bank accounts, investments, or real estate. It also includes the family’s relationships, skills, social network, and health. Wealth is really what makes us flourish as human beings.
Implementing a Family Governance & Education Program
These four steps are foundational elements to implementing a family governance and education program in your family office. They can be adapted to fit the particular circumstances of the family.
1. Values Discovery
When families start on the task of building wealth for a multi-generational legacy, they first need to assess where they are and set goals for where they want to be. The questions are qualitative rather than quantitative, in order to capture the family’s lived experience with their current state of wealth. This means having an in depth conversation with the family about where they are at and what is important to them. If there are multiple generations of family members, it may be important to have a few conversations or an anonymous survey before a family-wide meeting so that advisors can guage ahead of time if there are confliciting visions for the family.
There are a couple tools that advisors can use to facilitate a conversation around the family’s vision, values, and mission. However, advisors should be careful to avoid some common pitfalls around this type of conversation.
Either before or after this discovery meeting, family members can also complete a Wealth Assessment that evaluates the family’s qualitative wealth (i.e. spiritual, social, human, and intellectual capital). Using the results of this Wealth Assessment, the family’s advisors can assemble a metric to chart where the family is now in their wealth, and their ongoing progress towards their goals. Quarterly reports can serve as a holistic summary of the family’s wealth and place individual life events of the family or asset management updates into the context of the whole. The family can update their metric as they reach goals and as their situation changes.
2. Culture-Building
A family governance and education program must go beyond annual Family Assemblies—it should shape the daily mindset of the family office. If the family is serious about stewarding its qualitative wealth, then the family office must consistently ask: How does this financial decision affect the family’s human, social, or intellectual capital?
While a dedicated governance and education specialist may facilitate meetings, resolve conflicts, or design learning initiatives, the deeper purpose is cultural: to prioritize the family’s overall well-being in every aspect of decision-making.
To succeed, the family office should embed a culture that trains all advisors—whether legal, financial, or operational—to recognize and support the full spectrum of family wealth. This requires inter-disciplinary awareness and a broader philosophical outlook. Increasingly, families expect more than siloed expertise in tax or asset management; they want advisors who understand family dynamics, values, and long-term flourishing. Meeting that challenge is not only essential for governance, but is also a powerful opportunity for differentiation in a competitive field.
3. Ongoing Education
Constant learning is the key to consistent growth over time. A family with a rising generation should have a curriculum that provides learning opportunities adapted to the ages and ability levels of its younger members. Topics could include financial literacy, entrepreneurism, and leadership. For example, provide families with a “scope and sequence” that maps out topics and resources for family members at different stages. A good time to kick off a family education program using fun, relational activities might be at a family retreat. Follow up content and communication could happen virtually for the rest of the year.
Even though not all family members may be active owners directly engaged in family governance, all family members are still owners in the family. It makes a great difference whether these members act in the best interests of the family. Fostering a robust sense of ownership among members not engaged in governance can come through identity-building relationships and activities.
For example, there may be a bi-annual family retreat to strengthen relationships among different generations and family branches; another common activity is an annual democratic Family Assembly that has some decision-making over education decisions and has the ability to ratify and alter the family constitution. At these Family Assemblies, family leaders can reiterate the family’s vision and apprise family members of the mission (actions) being taken to achieve this vision. By remaining informed, family members who are not active owners can still appreciate their shared purpose in the family enterprise. Ultimately, each family member needs to feel that they belong in the family, and that their actions have a direct impact on the wellbeing of other family members.
4. Structures and Systems
Successful multigenerational wealth transfer depends on continuity of values, not just capital. A key element of family office governance is the family constitution—a morally binding document that articulates the family’s mission, values, and vision for the future. It provides a high-level overview of the family enterprise, including its legal structures, business operations, and guidelines for family participation. More importantly, it defines how the family makes collective decisions, through forums such as the Family Assembly, Family Council, and agreed-upon conflict resolution frameworks.
The family may also like to spell out the means through which the family will make shared decisions, including a Family Assembly, a Family Council, and a framework for conflict resolution. Ideally the document is a living and collaborative document that family members actively participate in writing, reading, and updating. Read more here about the Family Constitution.
Philanthropy is another pillar of legacy planning. Rather than making reactive or tax-driven donations, families who define a shared giving mission can target causes that reflect their values and track their impact over time. This strengthens the family’s identity and provides an opportunity for the rising generation to engage in decision-making. A private foundation can serve as a governance and educational tool, bringing family members together to evaluate grants, practice budgeting, and take responsibility for shared outcomes.
Finally, trust education is essential. While trusts are valuable tools for asset protection and estate tax planning, they can become sources of confusion or resentment if not well-communicated. Beneficiaries should be gradually educated about the structure and purpose of their trusts, the role of the trustee, and what it means to be a responsible steward of family wealth. When rising generation members understand the “why” behind the plan, and how they are empowered to participate in it, they are more likely to carry the family legacy forward with clarity and commitment.
Conclusion
Family offices that dedicate resources to a governance and education program will build up the human wealth of the family. By training the rising generation in skills, promoting cohesion, and clarifying the family vision, a family governance and education program helps ensure a multi-generational legacy.