We frequently assist families as they plan the transfer of their family farm to two or more successors. Sibling partnerships are inherently more complex, with greater risk of conflicts and frustrations. The biggest challenges siblings encounter are emotional issues, which seem more difficult to manage and resolve than the business issues. The greatest legacy that parents can leave is successors who are able to partner effectively, maintaining good business and family relationships.
A transition to a sibling generation requires acceptance of a team approach in sharing of work, management, decision-making and farm equity. Parents must first mentor the siblings, and then be open to letting go of authority and decision-making — thereafter accepting that the siblings must renew and advance the farm and have their own strategic success.
The siblings should discuss and find motivation from the advantages of their sibling partnership. Your farm is their unique opportunity to:
- preserve your family’s values and farm legacy, and pass those values to their children
- have meaningful careers working in, managing and leading your family farm
- build trust that strengthens both family and business relationships
- earn the financial security and success that comes from being part of a successful farm business
The siblings should also recognize, discuss, accept and proactively deal with the disadvantages of being in a sibling partnership. Each sibling will:
- live with a substantial loss of personal autonomy and privacy that comes from working in a family business
- be financially dependent on the farm’s success
- need to compromise his or her desire for independence with the required interdependence of being a partner
- accept being accountable to siblings for his or her performance and subject to their input, questioning and criticism
Children who left the farm only need to deal with family relationships.
The key to any sibling partnership is the concept of “we,” meaning group benefit, achievement and recognition. Everyone needs the attitude that “I am here to make sure our families are successful,” rather than “I am here to tell these people what to do,” or to favor themselves or their family. To operate as a team, the siblings must understand and commit to the shared values that give the farm meaning in their lives and motivate good behavior. They must have a shared short-term and long-term vision for the farm’s future.
Focus on farm’s needs
Each sibling’s personal and business expectations must be understood and adapted so that the team’s expectations are compatible. Each sibling must focus on the farm’s needs and mission, respecting the reasonable concerns of others. Roles, duties and responsibilities should be delegated based on who is good at what, so that each sibling can play to his or her strengths. The siblings must recognize that each job on the farm, whether as leader, manager or dedicated worker, is essential, important and deserves respect.
Effective, frequent communication and good listening skills are essential in a good partnership. Each sibling needs to be honest, respectful and proactive in communicating his or her decisions, concerns and expectations to the other siblings, and seek the input and thoughts of the others. Regardless of the defined roles in the business, sibling partners should communicate with each other about decisions that affect the farm.
Conflicts are normal in families, but conflicts over farm management and ownership are even more damaging, and can damage both family and business relationships. Ignored conflicts do not go away — they accumulate and fester. Existing and future frustrations, sibling rivalries, and other conflicts, both large and small, need to be dealt with promptly and resolved.
Twohig is a partner in the agricultural law firm of Twohig, Rietbrock, Schneider and Halbach. Call him at 920-849-4999.