The family founda­ti­on as a long-term oppor­tu­ni­ty for business succession

In many entre­pre­neu­ri­al families, the main part of the assets consists of the actual business. There­fo­re, there is very often a desire to keep the business in the family in the long term, even if there is no suita­ble succes­sor within the family.

The search for and elabo­ra­ti­on of a suita­ble long-term soluti­on for business succes­si­on requi­res a long time horizon of usual­ly signi­fi­cant­ly more than 2 years. It is about the long-term securi­ty of one’s own life’s work, but also about genera­ting suffi­ci­ent­ly high returns for a carefree retirement.

The family founda­ti­on to safeguard the life’s work

In the case of larger compa­nies, it may also make sense to consider a family founda­ti­on as a holding compa­ny. The purpo­se of the founda­ti­on is prima­ri­ly to provi­de for the founder and the founder’s family. This not only leads to considera­ble tax advan­ta­ges in the medium and long term.

By setting up a founda­ti­on adviso­ry board, the influence on the manage­ment, which may be outside the family, can be secured. The founder has a wide range of options for struc­tu­ring the powers of indivi­du­al organs of the foundation.

Prevent inheri­tance dispu­tes through clear succes­si­on regulations

Especi­al­ly if there are a large number of family members and thus poten­ti­al heirs, inheri­tance dispu­tes can be preven­ted in the long term through a founda­ti­on model, as can a possi­ble threa­ten­ed sale of the compa­ny after the entrepreneur’s death. A clear formu­la­ti­on of the foundation’s purpo­se helps to ensure that the life’s work is dealt with in the entrepreneur’s best interests in the long term.

In additi­on, the provi­si­on aspect of the family should not be undere­sti­ma­ted. With a family founda­ti­on there is the possi­bi­li­ty, unlike with a chari­ta­ble founda­ti­on, to alloca­te the income of the founda­ti­on to the entre­pre­neur and the relati­ves in any amount.

The experts from K.E.R.N. and Partner ? The succes­si­on specia­lists will be happy to help you with the detail­ed design. A pool of experts is available for the legal and fiscal assessment.

Tips for further reading:

Compa­ny succes­si­on in retail requi­res good preparation

Prepa­ring for business succes­si­on - 3 practi­cal tips

Advice traps in the process of business succession

Free webinars on business succession

Selling a compa­ny in the IT industry