Issue link: http://read.uberflip.com/i/1251420
16 POTATO GROWER | JUNE 2020 Imagine it's the day after Thanksgiving. Four generations of a farm-owning family sit down to a casual supper of leftovers. Plates are filled, drinks are poured, and everyone digs in. After some lighthearted banter, Dad puts down his fork and clears his throat. "There's something I want to discuss," he says. "I think it's a good time." Everyone turns their attention to the head of the table where Dad sits. "We need to talk about what to do with THICKER A defined plan of succession is one of the greatest gifts you can give your family. By John Zitzmann, Financial Advisor, Morgan Stanley the farm after Mom and I are gone," he says. Silence. "It can be a tough subject to talk about, and it can lead to real conflict," says Angelo Loumbas, senior member of Morgan Stanley's Family Office Resources team. "Even in a family that gets along well, there are often a number of open issues after the wealth originator is no longer around." SUCCESSION: WHO WANTS TO DO WHAT? Like any family-owned business, a farm needs a clear plan for succession if it is to survive the retirement or passing of its leader. Unlike other businesses, however, a farm may have additional emotional baggage. Suppose it's also the family home, full of childhood memories. Or what if different family members have varying levels of interest, commitment or emotional attachment? "We see it all the time, where one sibling will want to take over the business, while the brothers and sisters never saw it as part of their future," says Loumbas. "So that's the first step: figuring out everyone's role moving forward. Discussions about this can get intense, which is why we offer our family governance service to ensure a clear outcome." FIVE STEPS TO CONFLICT-FREE FAMILY GOVERNANCE 1. Create a mission statement. The wealth originator should outline his or her wishes in a detailed, written document. 2. Establish priorities and guidelines. This is your legacy. It's important that everyone involved understands your wishes. 3. Communicate your wishes to everyone. Even with the mission statement, clearly confide your intentions to each family member, and allow each of them to be heard. 4. Work with an outside facilitator. They can keep the process on track and know how to compose the final document. 5. Don't wait. Get it done now. Your family will thank you later. When the wealth originator's wishes are written down, his or her legacy has the best chance of being preserved.