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Best Practices for Multigenerational Families

Two young fish are swimming along when they pass an older fish swimming in the opposite direction. “Good morning,” says the older fish. “How’s the water?”

The two young fish nod and swim by. A few minutes later, one fish looks at the other and says, “What’s water?”

For many people, family values are a lot like water for fish. Growing up, our family values are all around us. They shape our interactions, our decisions, and our priorities. From a young age, they guide how we interact with the world and the people we will become. Yet like the fish surrounded by water, we rarely stop to consider what our values are, where they come from, and why they matter.

Values Defined

Values provide us with a foundation for who we are. They are the internal guides to our behavior and help us to make life choices and take action. It’s common to confuse these organizing principles with the beliefs, choices, or preferences that stem from them. This distinction is critically important, especially when considering the values of future generations. As Ellen Miley Perry writes in Tom McCullough and Keith Whitaker’s “Wealth of Wisdom: The Top 50 Questions Wealthy Families Ask:”

“Families often experience great concern that their deepest values are not being embraced by the next generation, when indeed the value is embraced, but the expression is different.”

Why Values Matter

Defining and aligning values can feel like an enigmatic endeavor. We think values are assumed, even innate, and thus remain unspoken, yet few exercises are more important – especially for families of significant means. In many families, rising generation members want to understand and embrace the foundational values of the family. Family leaders are eager to pass on those values. Yet, there are few occasions for the generations to come together to have these meaningful conversations. The values of a multigenerational family serve as the bedrock of family relationships and impact a family’s actions and priorities for years to come. 

When those values are misaligned or unidentified, families risk losing control of their legacy and fomenting deep rifts between family members that can have far-reaching effects. Too often, the wealth that family leaders see as a blessing feels like a burden to future generations. Despite the best intentions, complications and resentment can enter the fold when inheritance and complex agreements are involved. 

Taking the time to understand our values – both individual and collective – and working to proactively define the values that are important to us is an essential undertaking, especially for multigenerational families. Flourishing and cohesion depend on creating a framework for defining and embodying a shared set of values today in order to support the future of the family. Ultimately, these values center around big questions family members should seek to answer:

• What do we believe in as a family?
• What purpose do we want wealth to serve in our family?
• How do we want to work together to achieve that purpose?

1. Define Your Personal Values

The work of establishing shared family values begins with each family member defining their personal values. At this beginning stage, families:

• Establish a starting point and common ground from which to work.
• Gain clarity on the distinction between organizing principles and preferences.
• Benefit from the opportunity to learn more about each other at a deeper level.

When reflecting on individual values, it can be helpful to consider where your priorities lie. In our work with countless multigenerational families, Pitcairn has refined a values exercise that uses The Values Edge System pioneered by noted family governance and organizational consultant Dennis Jaffe. Here are examples of some key categories and their associated values used in those sessions. 

• Mastery – Mastery represents individualistic pursuits and success with values, such as achievement, excellence, and recognition.
• Inner Development – Inner development focuses on personal learning and exploration with values, such as personal growth, gratitude, and open-mindedness.
• Tradition – Tradition honors the way things have been done with values, such as stability, loyalty, and security.

It’s important to note that these categories are meant to be guidelines, not absolutes. They’re effective in helping to solidify our personal values by providing us with themes in which our actions, choices, and decisions can be reflected.
 

2. Define Your Shared Family Values

This deep understanding of personal values gives families a strong vocabulary and framework for developing a set of shared values. At this stage, consider the range of values presented by various family members. Look for gaps as well as commonalities in values identified in principle and values advanced in practice and daily life. For some families, this is a new exercise, and for others, it’s more about revisiting and refreshing values established by one generation as the next generation emerges. 

Carve out time with family members for a discussion about a set of shared family values. Often, this means challenging conversations that center on those big questions facing families. In a conversation with Pitcairn Chief Knowledge and Learning Officer Amy Hart-Clyne and Pitcairn Partner Dennis Jaffe, the two discussed how families can create and foster shared values. 

“What creates engagement and commitment is finding a purpose that really excites people. Family members want to talk about how they can use their wealth and what kind of impact they can have. They want to do something important and find a shared purpose around doing that.” 

This desire for greater purpose can be the catalyst in opening up dialogue about the family values of the past and present, and how future generations will inherit and interpret these values. It’s important to note that these shared values are not meant to replace or overrule an individual’s personal values. They are about finding alignment and establishing a shared family purpose that still honors each member’s independence.

3. Putting Family Values into Practice

After the soul searching and deep conversations required to establish a shared set of values, many families find themselves asking the next logical question: “Now what?” Without a plan to put these values into practice, the work can remain conceptual and fail to have any meaningful impact on family dynamics and decision-making. With the right plan, however, values can be infused into many aspects of a family’s interactions and ambitions.

Here are a few examples of some tangible next steps a family can take once it identifies a shared set of values.

• Leverage the values work to create a family vision statement and mission statement – shared values serve as a great source of information for outlining the family vision.  A vision statement is an inspirational statement of what the family aspires to be.  A mission statement is how the family will achieve that vision.
• Create or refine governance structures – ensure the governing entities, such as the family council or family constitution, are updated to reflect and support the shared family values and the purpose of their wealth. In other cases, building a governing system to have these conversations and make these decisions will help bring the values to life. 
• Refine family business operations – there are likely opportunities to ensure the business elements of the family’s operations, including a family limited partnership, are also structured to reflect and support shared values and decision-making.
• Advance your commitment to something important to the family – let’s say the family identified social responsibility as a key shared value. The family could create a joint philanthropy initiative to ensure giving aligns with broader social responsibility values.
• Continue the conversation – even with agreement on specific values, family members may have very different ideas about how to put those values into practice. A legitimate and meaningful next step may be to continue the conversation around values and what they mean to the future of the family with a trusted outside advisor, counselor, or family therapist to seek any alignment that the family feels would best serve them.
  
  

A Better Approach to Meaningful Family Values

No matter what stage of the family values process you’re in, navigating it requires dedicated time, reflection, and a perspective that’s difficult to achieve. For more than a century, Pitcairn has focused on helping families foster that perspective through structured, experience-driven exercises designed to uncover shared values and foster meaningful dialogue.