Skip to main content

In last month’s FO Perspective, we looked at culture as the most effective influence on success or failure of family legacies. I alluded to the other key driver of success and for those with the ol’ growth mindset, the answer is obviously personal development! Thank you for reading on Canada Day!

As individuals get stronger they act more in alignment with their goals, and discover clearer and more relevant goals as well.

I believe well-meaning, growing, caring family members cannot help but become better contributors to family goals, although sometimes managing individual and family goals can create quite the interesting set of trade-offs and conflicts!

I’m in Invermere right now with cousins from the States that I haven’t seen in ages (and all of our kids are creating quite the mayhem), it is Alex and my 12-year wedding anniversary, and my goal of writing about family governance monthly is at stake! So I’m fortunate to lean heavily on a LinkedIn Post, I note that the best place to start is personal development when worried about the future impact of the family wealth on the family.

That article has a great School of Life video embedded. Maslow’s hierarchy of needs is often represented as a pyramid because it gives a relatable image to the idea that the bottom levels of the pyramid are more very critical and often the greater focus of people. Basic human needs and safety and security should never be taken for granted.

Except wealth clearly distorts this focus.

There are very few heirs that can find fulfillment in creating a life where they have their basic human needs served. That would feel more like giving up, wouldn’t it? Maybe I’m being harsh.

No I’m really not being harsh, a focus on the bottom of the pyramid is definitely not taking advantage of the incredible opportunity that our good privilege provides to make a big impact and find big fulfillment.

Because privilege ensures that our pyramid does not work the traditional way, quite a lot of time and resources should rightfully go into the top needs; seeking self-actualization and striving for transcendence.

How can the wealth equation frame our understanding of the importance of personal development in the context of meaningful family legacies?

FW = R (HC + RC) 

Your family wealth is equal to your resources multiplied by the total of your human and relational capital pools.

R: Spend resources on personal development, it is as simple as that. Both time and money can be extremely effectively deployed into improving oneself. Please reach out if you aren’t sure where to start with topics like coaching, peer mentorship, conferences, mental models, seeking mastery, culture mining.

HC + RC: Growing your human capital clearly a key to this wealth equation, but I find it amazing how regularly I forget that we are all just humans in our relationships and even the best sides of all of us are going to run into mistakes in the context of decades-long relationships. We have to be kind to our family members, because we have to build up our relational capital for those downturns when we have to spend a little of that goodwill and trust we have built up in the only way that caring families really understand.

FW: leading more fulfilling lives (while maintaining a commitment to the family’s values) is the most autonomous way to contribute to the family legacy.