Family Business
Preparing for the Sale of a Family Business
While many business owners are struggling to find qualified successors, family members oftentimes oppose proposed sales to outsiders because they think they should have the chance to take over the business. Research from Rothstein Kass suggests that advance planning can minimize family squabbles and ensure smoother business transitions.
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Survey of the Next Generation of Family Business
KPMG Australia explores six areas related to family business succession: preparation; leadership change; new directions; governance as a priority; performance measurement; and pride in the family business. The report focuses on Australian families but offers suggestions and insights that can be useful to families anywhere.
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Trust in the Family Enterprise
Family business consultant Kenneth Kaye discusses some characteristics that facilitate trust among family members in two types of enterprises – family offices and family-owned businesses – as well as a conflict resolution intervention that capitalizes on humans’ instinctive propensity to trust.
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2010-2011 State of the Wine Industry
The outlook for small family-owned wine business in 2010-2011 is probably best described as mixed, with success defined more by the business model, capitalization and professionalism of management. Based on its research, SVB Capital believes there will be more winners, losers and some start-ups taking advantage of opportunities created by change.
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Family Continuity and Governance
Seven Tips to Overcoming Prenup Paralysis
The hardest part of reaching a prenuptial agreement may be simply starting the conversation with a future spouse. To ease the awkwardness of this necessary conversation, GenSpring Family Offices provides a series of tips, ranging from understanding the legalities to broaching the subject as part of a broader financial discussion.
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Industry Trends and Issues
Effects of the Economic Crisis on Insurance Companies
A simple, periodic verification of the credit-worthiness of an insurance company and the adequacy of the policy funding is not sufficient to fulfill the requirements of the Uniform Prudent Investor Act. A paper from J.R. Katz recommends that reviews of policy suitability include financial strength and claims paying ability, cost competitiveness, pricing stability, cash value liquidity and historical performance of invested assets underlying policy cash values. full article »
Performance Management
A new paper from Liebowitz Associates makes the case for a strong performance management system, noting its ability to help firms adapt to change, integrate business initiatives and execute strategies more quickly. The author also discusses the steps involved in implementing a well-structured performance management system. full article »
Managing Foreign Exchange Risk
When implemented responsibly, a successful foreign exchange hedging strategy can go beyond mitigating foreign exchange risk to actually improving the bottom line of a global business, according to a paper from SVB Capital. The author addresses the impact of currency exchange rates as well as best practices for implementing a hedging strategy.
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Short Selling: In Need of Globally Consistent Rules
Deutsche Bank details the benefits, rationale and structures for short selling in making the case for the United States and European Union arriving at an equivalent regulatory framework for short selling. Currently, varied rules raise the cost of compliance, complicate assessment of market conditions and increase legal risks, the authors say. full article »
Integrated Planning
The Sea Change in Generational Wealth
The planning landscape is likely to change even more as families seek to provide a sustainable pool of wealth not only for succeeding generations but also for the current generation. Nease, Lagana, Eden & Culley Inc. highlights the most significant of these changes and some of the advantages they present for planners and clients who are prepared to embrace change and navigate the altered landscape. full article »
Investment Planning
Importance of Asset Allocation: Brinson et al Revisited – Again
Hammond Associates puts empirical studies of asset allocation in perspective, starting with the 1988 study by Brinson, Hood and Beebower and working through subsequent research efforts. The author believes these often quoted and sometimes misinterpreted studies are limited in scope and the types of assets they explore and, thus, do not provide useful guidance for all asset allocation situations. full article »
Style Monitor: Top Line Versus Bottom Line
Credit Suisse researchers compare styles that have worked since the Feb. 5 market low with those that have worked up to the mid-January peak. Low P/E and low P/B have been two of the few styles to outperform in both periods. Researchers screen for outperform-rated stocks that trade on a P/E and P/B discount to their sector and the market and have earnings revisions better than their sector and the market. full article »
Distressed Debt
Babson Capital explores distressed debt investing, describing the bankruptcy process, the role of debtor-in-possession facilities and the importance of valuation in understanding the investment opportunity. The report also outlines three distressed debt investment strategies based on the level of involvement: discount value, activist and control. While written for a U.S. audience, this report contains information relevant to investors globally.
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Deep Value Investing
A new white paper from DLS Capital Management provides a high-level view of deep value investing, defining the strategy and addressing the benefits of deep value investing, deep value investing myths and key factors for investors to consider when evaluating value managers. full article »
Emerging Markets Private Equity Survey 2010
Coller Capital’s annual survey tracks private equity trends in emerging markets and investors’ plans related to those markets. Among this year’s findings: Investors expect their new commitment to emerging market private equity to accelerate over the next two years, and most of these investors expect this sector to outperform private equity as a whole. full article »
Frontier Markets: Overlooked Opportunity?
CTC Consulting makes the case for frontier markets as an attractive sector for risk capital. The authors consider recent performance, the potential for strong long-term returns and risks such as volatility, illiquidity and local market dynamics. The authors emphasize the need for diversification and evaluate exchange-traded funds that cover portions of frontier markets.
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The Sustainability of Endowment Spending Levels
Analysis by Spring Mountain Capital shows that increased spending will profoundly jeopardize the long-term health of endowments. This paper proposes a framework for analyzing spending decisions that can be of use to endowments and other types of investors who need to balance long-term growth objectives with short-term spending needs. full article »
Angel Investing: The New Paradigm
Confronted by the effects of the most significant economic downturn in the post-war era, angel investors want more certainty and earlier exits. In this paper, Landmark Angels discusses a strategy to increase the success of angel venture investments and the likelihood of better and earlier returns. full article »
Lifestyle Management
Hiring Domestic Help: An Overview for Family Office Executives
When a family needs to add to their domestic staff, they often call upon their family office for assistance in overseeing the process. This paper from Mahler Private Staffing provides an overview of the steps involved in hiring domestic staff, as well as questions to ask when assessing search firms. full article »
The Power of Life Coaching
Coaching can be a transformational process, helping individuals overcome obstacles, solve problems, make significant changes and accomplish lofty goals. Conscious Connection provides an overview of coaching, discussing the work of a professional coach and offering tips to ensure selection of the right coach.
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Strategic Philanthropy
Engaging the Next Generation in Family Philanthropy
At its best, family philanthropy provides families with an opportunity to reinvigorate their grantmaking, inviting the contribution of fresh and original ideas and approaches from younger generations, and bringing families together in pursuit of a mission inspired by common values. Research conducted for Credit Suisse shows the diversity of experience of family philanthropists around the globe.
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International Grantmaking: Overview and Guidelines
Increasingly, U.S. foundations are funding international causes either through direct giving to overseas recipients or U.S.-based international programs. Foundation Source offers information and guidelines to help private foundations legally and effectively fund these international efforts without violating U.S. tax law. full article »
Charitable Gifts in a Climate of Deaccessioning
Tough economic times have cultural institutions examining their inventories to decide which items should have ownership transferred to other institutions or individuals by sale, exchange or grant. This paper from Withers notes the increased need for donors of charitable gifts to make their intentions and restrictions on the gifts clear in solidly drafted gift agreements and testaments.
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Renewable Funding
While the philanthropic need is greater than it has been at any time in history, the recession has taken its toll on social funding. Springbanc Social Capital Advisors believes social enterprise – and the hybrid structures being created to foster it – may be the answer to bridging the gap between for-profit investing and philanthropy. full article »
Taxation
IRS Sharpens Approach to Audits of High Net Worth Individuals
With the IRS intensifying its focus on taxpayer non-compliance, ultra-wealthy individuals are wise to take steps now to reduce the likelihood of an audit and ensure they are fully prepared if one should occur in the future. A new white paper from HUB International offers some guidance for proactive taxpayers. full article »
Proposed New York Fiduciary Income Tax Changes
It long has been clear how to structure a testamentary or inter vivos trust to escape high state income
tax, and many residents of high-tax states have taken advantage of these rules to reduce the tax burden on their trusts. Wilmington Trust examines a proposal in New York that would eliminate this certainty.
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Angel Investors May Be Eligible for Tax Credits
Angel investors could qualify for personal income tax credits equal to 25 percent of their investment in certain early stage businesses if Connecticut’s governor signs a bill recently passed by the state’s legislature. A brief article from Withers Worldwide provides highlights of the legislation, which would take effect July 1.
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