Writing family values in plain words
Built on Chapter 5 of The Single Family Office by Richard C. Wilson. Full chapter text: FamilyOffices.com.
A family value should help someone make a decision when the founder is unavailable. Words like excellence and integrity are easy to approve. They become useful when a family says what conduct they require and accepts the cost of following them.
Chapter 5 ties values to hiring, investing, and the work of the office. For a billionaire family, I would write the values so a new employee and an adult heir can reach the same understanding without a long explanation from the founder.
Begin with decisions the family respects
Ask family members to identify conduct they want repeated. Use events they can verify and are willing to share. A promise kept when it was inconvenient tells the group more than an abstract claim about trust.
Keep the account accurate. Family history can acquire details through repetition, and a compass should not make that problem worse. If people disagree about what happened, use the disagreement to identify the principle they want to follow going forward.
The words should come after the conduct is understood. A value about independence might concern earning responsibility, handling personal commitments, or building a career. Those are different expectations and deserve different wording.
Explain what the value changes
Give each proposed value a short explanation and one operational consequence. If the family says it values privacy, the consequence might be a rule about who may speak publicly for the office. If it values careful stewardship, the consequence might be independent verification before a commitment.
Avoid pretending that every decision has an obvious answer. Two values can pull in different directions. Supporting a relative and treating investment proposals consistently can become a difficult choice. The policy should identify the route for resolving it.
A value does not replace that process. It explains why the family wants a particular standard, while the policy tells staff how to apply it.
Use language people already say
In discussing family values, I explain that our family values sit at the top of a sheet I bring to breakfast. I discuss principles with my children using that sheet. The values have a place in a repeated conversation, which makes them easier to remember than a document kept out of sight.
That is the language test I would use. Can a family member explain the value over breakfast? Can an employee connect it to a decision without reading a page of commentary? If the explanation requires special vocabulary, shorten it.
Let people question a word they would never normally use. Agreement with an elegant sentence is weaker than understanding a plain one well enough to act on it.
Set a standard the founder will follow
A value loses authority when the founder exempts a favorite advisor or family project. Discuss how the standard applies to the people with the most influence. That discussion may reveal that the proposed rule needs a narrower scope.
Write exceptions through the authorized process. An exception may be justified by facts that deserve privacy, but it should still have a recorded reason and approver. Employees need to know that the policy remains operative.
Apply the same care to employment. Values can inform suitability for a role, but they should not become vague labels used to avoid explaining performance expectations. Define the job and the conduct expected from anyone holding it.
Keep the list short enough to use
Choose a few principles that carry actual decision weight. The family can care about many good things without placing all of them in the core list. Repetition and use matter more than the number of words approved at a retreat.
Review the language after the office has used it. Ask where it helped and where it failed to answer a question. Clarify the explanation through the agreed process, while keeping a record of changes.
Words the children hear repeatedly
In my own family, the values appear at the top of a sheet I bring to breakfast. I described that routine in a recorded session about learning and technology. We read together and return to the principles in ordinary conversation. That example is useful when choosing the words for a family compass. Write something a child can discuss at the table and an adult can apply to a decision. If the phrase only makes sense after an advisor explains it, simplify the phrase. The repeated conversation gives the words meaning; printing an impressive list by itself does very little.
What to take from this
- Describe conduct before selecting the label.
- Give each value a consequence for office decisions.
- Use words family members would say aloud.
- Apply the standard to influential people as well as employees.
Take one recent hiring or investment decision and explain it using the proposed values. Keep the language that makes the reasoning clearer and remove the language that adds nothing.
This page is general information, not legal advice. Family governance documents and dispute processes should be reviewed by a qualified attorney.
Questions and answers
How many values should a family choose? Choose a small set the family can remember and apply. A long list often avoids deciding which principles take priority.
Can a value be one word? It can, but add a plain explanation of the conduct it requires. Different people may interpret the same word differently.
Should staff help write them? Staff can explain how wording affects actual work. The family should retain responsibility for the standards it wants the office to follow.