- Generational and cultural conflict within the family.
- Cross-border legal and tax conflicts resulting from differences across jurisdictions.
- Antiquated legislation and out-of-date language in wills and trust deeds.
- The difficulty of accommodating everyone’s needs: competing/differing interests and views between generations and/or as a result of different cultural perspectives.
- Distrust and difficult relationships between prior and current members of the family. As one respondent put it, there is ‘less “glue” to keep the family together’.
Three quarters of respondents identified that cross-border or tax conflicts resulting from differences across jurisdictions are proving contentious and leading to litigation.
Some 69 per cent highlighted generational issues and 65 per cent of respondents identified out-of-date language used in wills, trusts and deeds.
Conflict can be particularly damaging for family businesses, and three quarters of respondents are seeing a greater trend towards generational conflict within the family and disagreement in relation to family business succession.
Philosophical differences
The same number are seeing a trend towards next-gen philosophy. These differing objectives from the younger generations are an important cause of tension. Another key trend noted is capacity issues – with 64 per cent of respondents highlighting this as an issue for families.
Alongside a number of other disputes arising from unclear or old-fashioned language, it is clear that a number of laws and legal definitions are out of touch with the current reality and need to be brought up to date.
Specific examples mentioned by respondents included laws in relation to:
- Cohabitation (relating to succession).
- Same-sex marriage (recognition across jurisdictions, inheritance, adopted children).
- Inconsistencies with regard to lasting and enduring powers of attorney.
New family constructs and dynamics are driving demand. The increase in complexities and potential for conflict associated with the modern family has resulted in increasing demand for advisors and their services.
Tax advice, trusts, global/cross jurisdictional services and family governance advice in particular have all seen increased demand and succession planning tops the list of issues on which clients seek advice.
Tax advice is a key issue, particularly for multi-jurisdictional families, as a result of differing tax rules and the increased focus on tax transparency and compliance.
This is also seen in the increasing demand for global/cross jurisdictional services. Trusts are also in demand, their flexibility proving attractive in providing the ability to respond to changing circumstances in light of more complex family composition.
Some respondents also flag that they are seeing demand for alternatives to trusts, such as family investment companies.
Advisers need to recalibrate
One size doesn’t fit all. There is no longer a one-size-fits-all approach to meeting families’ needs.
