Book Report

Analysis of “Family Wealth: Keeping It in the Family” by James E. Hughes, Jr.

The checkered history of long-term wealth preservation in families is mockingly captured by the adage: “Shirtsleeves to shirtsleeves in three generations.” In his book, James Hughes presents a roadmap for navigating through fractious family relationships, competing inter/intra-generational interests, poorly-designed succession plans and many other universal family business challenges. Although his prose can be disjointed – frequently interrupted by vague esoteric references to philosophical, psychological, anthropological and political theories – he manages to outline specific steps families must take to ensure long-term wealth preservation. Of course, he is careful to mention that the success of these strategies is predicated upon the existence of a well-developed sense of ethical centeredness and spirituality within the family. As Hughes explains:   “Every family I have observed that is successfully preserving its wealth is a reflection of the five virtues of truth, beauty, goodness, community and compassion. It reflects these values in its relationships with both family members and with all persons outside the family. I am convinced that without this spiritual component, a family cannot succeed in preserving itself, since its value system will fail and with that failure will come disintegration.”
For those families that possess the required cultural underpinnings, Hughes has organized his ideas/results in a very linear format – he first introduces his philosophy regarding family wealth preservation; he then discusses best practices in defining a mission, measuring success and leveraging individual skill-sets of both family and non-family employees; and he ends with an examination of estate planning techniques and reflections on the development of individual and collective responsibility to the family members and to the family business.

Hughes’s Philosophy of Wealth...