Who Should Lead Governance In A Family Business? Balancing Family Voice With Independent Insight

Family businesses aren't like any other. They are often built on sacrifice and shared effort, carrying with them not just the weight of financial investment but the values and memories of the people behind them. For many, the business is part of the family story itself. That's a source of great strength, but it can also make certain decisions harder.

One of the toughest questions? Who should be in charge of governance? Should it remain firmly in family hands, or is it better to invite non-family members into the process? It's not a theoretical debate. The answer shapes how a business is run, how decisions are made and how relationships are preserved.

Most families feel the pull in both directions. Keeping everything inside the family feels safe, more authentic. At the same time, the idea of independent voices (where people can ask hard questions without history clouding their judgment) has obvious appeal. In truth, the strongest family enterprises don't sit neatly at one end of the spectrum. They find a middle ground.

Governance in plain terms

Governance can sound corporate, even cold. But in a family business, it really boils down to something straightforward: the system of rules, agreements and practices that guide how the business is run. It's the framework that decides who has authority, how decisions are taken, and what happens when opinions differ.

That clarity matters because roles blur so easily. The same person might be a director on Monday, a shareholder on Tuesday, and a sibling or parent all the time in between. When those roles overlap, conversations can get messy. A brother may speak as an owner in one moment, but in the next he's speaking as a brother, with all the emotion that comes with it. Governance gives everyone a way to separate those hats.

It isn't about stripping away flexibility or tradition. It's about drawing lines in advance so that when the difficult conversations arrive, they don't pull the business, or the family, off course.

Family-led governance

There are obvious reasons families want to keep governance close. No outsider understands the history or the sacrifices. No one else has the same emotional stake. Family members know what the business stands for, and they care deeply about its future. That can bring real continuity and a sense of stability.

Employees often like it too. Many join a family business because it feels different – more personal, more grounded. Seeing the family take responsibility at governance level reassures them that the business isn't just about numbers on a spreadsheet.

Yet family-only governance can carry risks. Old disputes resurface. Generations view strategy differently. Parents may prize stability, while younger voices want expansion or change. Without structure, those debates become personal. And in the effort to avoid conflict, hard choices sometimes never get made at all.

Why independent voices matter

That's where independence comes in. Non-family directors or advisers bring something valuable – perspective without the baggage. They can say what others won't. They can ask whether a plan makes sense commercially, not just emotionally.

And in practice, they often act as a stabiliser. Families might hesitate to challenge each other, but outsiders can frame questions neutrally, reducing tension rather than adding to it. During succession, this can be vital. Emotions run high, expectations clash, and an independent voice can keep the process fair and objective.

It also sends a message outside the family. Banks, regulators, and business partners take more comfort when they see governance is more than just a private family affair. Independent oversight signals discipline and professionalism alongside heritage.

Finding the right balance

In truth, most families don't live at either extreme. The most resilient structures are those that combine both: family identity and independent oversight.

Sometimes this balance comes through a family council, which offers a safe space where members who aren't involved day-to-day can still have a voice in shaping long-term direction. It isn't about interfering in management. It's about making sure the wider family feels included and respected, which in turn helps keep conflict at bay.

Other families choose to write things down in a charter or set of rules[VR1]. It might not be legally binding, but it sets out the principles everyone agrees to live by. Who can join the business, how profits will be used, how disagreements will be handled. Having that on paper may not feel like a big step at the time, but years later, when memories differ, it can become the anchor that keeps everyone steady.

Of course, some matters do require legal certainty. Shareholder agreements deal with those. They cover voting rights, dividend policies, what happens if a shareholder wants to sell or passes away. These aren't exciting topics, but if they're left unaddressed, they can tear families and businesses apart. Better to face them early and avoid painful disputes later.

And then there's the board. Who gets a seat? Keeping it all in the family may feel safe, but in reality it can limit perspective. Bringing in independent directors can change the dynamic. They don't dilute the family's voice. They sharpen it, adding professional expertise and the courage to challenge assumptions when needed most.

Succession

Succession is where governance shows its true worth. Passing the baton from one generation to the next can be fraught if the groundwork hasn't been laid. Rivalries surface, expectations collide, and the business risks being paralysed at the very moment it needs clarity.

Governance helps families prepare long before that moment arrives. Clear criteria for leadership can be agreed. Processes for decision-making can be mapped. Conversations that might otherwise be combustible can take place against a backdrop of shared principles. Independent advisers can guide and assess, but the family sets the vision.

Handled in this way, succession stops being a crisis. It becomes an opportunity to renew purpose, to re-state what the business stands for, and to prepare future leaders to carry it forward with confidence.

Governance must evolve

The biggest mistake is to see governance as something to be settled once and then forgotten. Families grow, businesses change, and what worked in one generation may be unfit for the next.

That's why governance has to be treated as a living thing. Family councils should be revisited. Charters refreshed. Boards renewed with fresh perspectives. Not to impose rigidity, but to make sure the structure still works for the family it serves.

Family businesses that approach governance in this way tend to be the ones that last. The families adapt without losing their core, and they carry their businesses forward without letting disputes drag them back.

More than protection of wealth

It's easy to frame governance purely in financial terms. A safeguard for assets, and a way of protecting wealth. And of course, it does that. But it also protects something far more fragile, and that's relationships.

A thriving business that leaves broken bonds in its wake is hardly a legacy to be proud of. Equally, family unity can be tested to breaking point if the business itself falters through lack of planning. Good governance protects both. It provides fairness and clarity, but also the space for families to stay connected while still making sound decisions.

The Buckles approach

So, who should lead governance in a family business – family members, or non-family professionals? The honest answer is both. Too much concentration within the family can weaken governance; too little risks stripping away the very essence that makes the business unique.

Balance is the key. When families achieve it, governance stops being a burden and becomes something else entirely: a foundation. A steady platform that allows both the business and the relationships behind it to flourish, not only today but for years, and generations, to come.

At Buckles, we see governance as a conversation first, a set of documents second. We work with families to find structures that reflect their story, not a template borrowed from elsewhere. Sometimes that means drawing up a shareholder agreement. Sometimes it means helping draft a charter or supporting the creation of a council. Often it means guiding families through succession, where emotions and commercial realities collide most sharply.

Our aim is always the same – to preserve what matters most. The legacy of the business. The cohesion of the family. And the confidence that future generations will inherit both.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.