Five Trends Shaping Family Business Succession In 2018

For family businesses, succession plans are central to survival. Outsiders may suppose that such things are straightforward, but there is a surprising amount of nuance when it comes to succession. Personal and emotional factors can warp the plan in strange ways if you're not careful, or geopolitical trends may affect family businesses differently.

KPMG carries out an annual study of the factors that most influence succession plans in family businesses, and this year the main themes surround tax and timing, in a context of changing generational norms and economic uncertainties.

The five main takeaways are:

For family businesses in the US, the recent national tax reforms have hugely improved the tax reliefs available to family business transfers. As the UK and the EU continue to carve out Britain's exit plan, implications for family businesses in the UK remain unknown. In many countries, shadow economies are widespread, meaning that many businessesfamily-run ones includedoperate outside of formal business structures. There is a worldwide push for such informal enterprises to enter the legal economy. Increasing lifespans could disrupt business succession plans, as owners now want to stay active for longerplus, it means more family members living off the firm's assets. New, often more philanthropic, mindsets characterise the younger generation. Millennials who adhere to globally-oriented social values may have differing ideas as to how family wealth should be...