Family Constitution / Charter #
A family constitution or family charter is a guiding governance document that codifies a family’s shared values, mission, protocols, and approach to decision-making. It serves as a blueprint for family unity, succession, and the preservation of shared purpose across generations.1 Development of such a document is often most successful in families that have moved beyond founder control, where complexity or generational expansion creates a need for structured rules and clarity.2
Key Elements of Family Constitutions and Charters #
- Purpose & Vision: Defines long-term aspirations, legacy goals, and core values that should guide the family.
- Decision-Making Protocols: Sets out who decides on investments, succession, business, philanthropy, and how disputes are resolved.
- Conflict Resolution: Mechanisms for handling disputes transparently and fairly within the family council or assembly.
- Succession Planning: Describes how leadership, voting rights, and ownership are transitioned between generations.
- Family Member Roles & Responsibilities: Clarifies involvement in family office, board, or governing committees.
- Relationship to External Advisors: Guidelines for engaging advisors, independent directors, or trustees.
While not always legally enforceable, family constitutions provide an essential reference point for strengthening family cohesion and adapting governance as complexity grows.3 Survey data shows that families that establish constitutions are more likely to maintain unity and clarity into later generations.4
Best Practices for Drafting Charters #
- Engage all generations in defining values and strategic purpose
- Document both formal and informal governance protocols
- Review and update the document regularly as needs change
- Leverage professional facilitators for drafting and review
- Use the charter in onboarding, educating, and mentoring rising generations
