Women in family business: Is 'Succession' realistic?

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In the Emmy-award-winning HBO Max/Crave show Succession, created, written and directed by Jesse Armstrong, aging patriarch Logan Roy and his family plot and scheme against shareholders and each other as they maintain control over their international media conglomerate Waystar Royco. In this series, experts examine how much the show gets right in the area of succession planning, deal making and breaking, and personal relationships within family enterprises.

Women often have unique journeys in real-life family businesses, as we are exploring in several articles in this publication.

And this show takes a dramatic look at some of the roles women play in succession.

In the final episode of Succession’s third season, Logan makes a hasty decision to sell the conglomerate without informing his children, including sister Shiv Roy. When they get wind of their father’s betrayal, the siblings form an alliance, despite years of vicious competition, to access their power within a voting trust, but their father has leveraged voting rights he’s given to his first ex-wife, the children’s mother, as well as to his current, estranged wife.

Here, several experts take a look at the role women play in the series and compare reel vs. real life.

Meghan O’Neil, partner, Mills & Mills LLP in Toronto

We see Shiv Roy, the only female sibling, get sidelined a lot throughout the series, despite her clear capabilities and leadership instincts. How have you seen the role of women develop in succession planning and leadership roles?

“With some older clients, on the estate administration side, I have seen circumstances where the husband managed the finances of the family almost entirely, if not entirely, and the surviving wife, as a result, is not familiar with these matters and is thrown into making financial decisions she has never had to before upon the death of her spouse.

With younger couples, my clients who are women are usually just as involved, if not taking the lead more than her spouse, in the estate planning process.”

In the show, we see Logan’s wife and ex-wife having pivotal voting rights within the family voting trust. How realistic is it that spouses and ex-spouses obtain such power within a succession or estate plan?

“It is common for a spouse to be one of a number of named beneficiaries of a family trust, provided the terms of family trusts often give the trustees discretion as to how income and capital is distributed among any one or more of the beneficiaries (meaning the trustees can choose whether to make distributions to a spouse or favour the interests of other beneficiaries of the trust, such as children, over that of the spouse).

Whether an ex-spouse maintains interest in a family business following separation may depend in part on the ex-spouse’s involvement in the business during the marriage. Where a spouse owns shares in a privately owned corporation but is not directly involved in the business, this would likely be dealt with in a separation agreement (i.e., the spouse involved in the business may buy out the other spouse from his or her interest in the business in the course of dividing the assets between them). Both spouses often want as clean a break as possible upon separation and being in business together can certainly complicate that.

I think this is a more probable scenario for the Roys because Waystar is a publicly traded corporation where there are more shares to give away, whereby a spouse maintaining shares in the company, or receiving these as part of the assets he or she is to receive in the course of the separation, is more likely than the case of a privately held corporation.

A large part of Logan Roy’s wealth is likely wrapped up in Waystar, and what he owed his ex-spouse, Caroline, in his separation, given his substantial wealth, was likely an incredibly large payout. Accordingly, Logan may not have had the liquid assets easily accessible to satisfy his equalization payment to Caroline in full, and in efforts to avoid having to liquidate any of his interest in the corporation (which could prove extremely complex), offering shares in the publicly traded Waystar to Caroline as part of his settlement with her may have been the most practical settlement option.”

Peter Jaskiewicz, academic director, and Katrina Barclay, executive manager, of the Family Enterprise Legacy Institute (FELI) at the Telfer School of Management, University of Ottawa

We see Shiv Roy, the only female sibling, get sidelined a lot throughout the series, despite her clear capabilities and leadership instincts. How have you seen the role of women develop in succession planning and leadership roles?

“There is still a long way to go towards eliminating gender bias. A recent study we published found that in multi-generational family businesses, sons were brought up to be entrepreneurial, but daughters received minimal or no financial or emotional support to learn from the older generation and eventually start their own ventures.

Of the 24 business families we spoke to, 78 per cent of sons pursued a career in entrepreneurship, but only 7 per cent of daughters received an entrepreneurial education and became entrepreneurs. This has long-lasting consequences. These businesses are essentially cutting off 50 per cent of the next generation and causing considerable resentment among their children.

But there is hope. At the Family Enterprise Legacy Institute (FELI) we want to place emphasis on research and education that supports and empowers the next generation of female business owners and leaders.”

In the show, we see Logan’s wife and ex-wife having pivotal voting rights within the family voting trust. How realistic is it that spouses and ex-spouses obtain such power within a succession or estate plan?

“The answer to this question often differs across families based on their definition of who belongs to the family.

In some families, partners and in-laws are not viewed as part of the family. They have to sign pre-nuptial agreements and cannot inherit or receive any votes.

However, in other families, partners or in-laws can inherit, receive or buy shares or voting rights. In these cases, it is possible that they will retain pivotal voting rights – even after separating from their spouse. Unfortunately, we have seen cases in which stepmothers or fathers actively disadvantage their stepchildren in favor of their own biological children. However, we have also seen the opposite – that is, stepfamilies where everyone is treated equally.

We have also met many families in which adopted children are treated like every biological child. In other words, it depends on the family and a one-size-fits-all approach would not be appropriate.

Finally, individuals selling a business behind the entire family’s back is rather rare because it would likely fuel major conflicts within the family. If it does happen, it is usually an indication of unbridgeable differences and rampant conflicts in families in which members might have little contact and communication amongst each other.”

Don Steele and Patrick O’Connor, partners, Blackwood Family Enterprise Services

We see Shiv Roy, the only female sibling, get sidelined a lot throughout the series, despite her clear capabilities and leadership instincts. How have you seen the role of women develop in succession planning and leadership roles?

“We absolutely are seeing more women as senior leaders of family businesses and as future leaders in our client families’ succession plans. Anecdotally, there are observations in the family enterprise world that women are bringing new perspectives into family businesses on the importance of community, nurturing entrepreneurship and how to live an integrated life that respects the heavy demands of both work and family.”

In the show, we see Logan’s wife and ex-wife having pivotal voting rights within the family voting trust. How realistic is it that spouses and ex-spouses obtain such power within a succession or estate plan?

“This seems to be very ‘Hollywood’ and conflict and dysfunction sells. In our experience with families, we have never seen these type of voting rights put in place.”

Responses have been lightly edited for clarity and length.

More from Canadian Family Offices

• Women have struggled to be heard: family real estate firm’s Lisa Wolverton
• Women, formerly sidelined in family business, now more embraced
• Saputo sisters forged their own path
• Founder ‘excited’ by daughter’s interest in the business
• WCD’s Brookman sisters worked with dad to run the company

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