Matthew Fleming, James Bond author relative, on enterprise family lessons learned
A 5th generation member of the British family, as partner in the international multi-family office he notes that what families worry about most is not money
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Matthew Fleming was only 1 when his uncle, who created James Bond, passed away, but he can spy the qualities that help a family business thrive.
“I’m the fifth generation, and we’re acutely aware of the amazing things that have happened in our family,” says Fleming, partner of Stonehage Fleming, the family office that manages US$75 billion – the Fleming fortune, along with other families’ assets around the world, including Canada.
“The real roots of the business go back to the 1870s and 80s and my great-great grandfather Robert Fleming, who left school at 14. He ended up doing extraordinary things, building this wonderful family business,” he explains about the founding of the investment and merchant bank in Scotland.
“That enabled our family members go off and build great careers.”
Fleming cites his grandfather’s and four great-uncles’ distinguished World War II careers — one brother, Michael, was killed.
“These were huge, great men,” he says.”
From merchant banking to James Bond
And, of course, there is the work of his great uncle Ian Fleming.
“His incredible imagination gave us not only James Bond, but Chitty Chitty Bang Bang,” a much-loved children’s book published in the 1960s, Fleming says.
Readers can argue among themselves who is the best James Bond in the films, but there is no arguing with success — Bond movies alone have generated about US $7 billion.
The character himself is purely from Ian Fleming’s mind; his 14 Bond novels and several short stories and Agent 007 remain a revered part of the family’s legacy, Matthew Fleming says.
The family started its own firm, Fleming Family and Partners, to manage the fortune his ancestor Robert started and which continued to grow.
In 2000 they sold Robert Fleming Holdings Ltd. to Chase Manhattan Bank for more than US$7 billion and in 2014 the Fleming family office merged with South African family office Stonehage; the firm now manages family offices through 18 locations worldwide.
Fleming’s point about his work is that understanding the “family” part is the operative, most important aspect of managing a high-net-worth’s family business.
“Most family offices are set up to manage investments of one form or another, but when we talk more extensively with the families we work with [at Stonehage Fleming] we find that the investment aspect is very low on the list of their concerns,” he says,
Fleming has prepared a “Lessons Learned” seminar for wealthy families about managing high-net family wealth, drawing from his family’s own experiences.
Lesson 1: Shared purpose
“The first big lesson is to ensure that there really is a well-articulated shared purpose to the family business,” he says.
“That’s easy if you’re an entrepreneur: You created the wealth yourself and want to establish a family office. In our own family’s case, there were several generations who wanted to have input and we needed to find alignment,” Fleming says.
“Creating a shared purpose is absolutely critical.” He says the family’s war experience helped enable family members to deal with tough, difficult situations rather than simply basking in wealth during good times.
Lesson 2: The right leadership
“The second lesson is that you need the right leadership. You need the right person leading the family at different phases of the business,” Fleming says.
“For example, having a peerless entrepreneur who takes risks might be brilliant at the beginning, but this might not be the right person to lead when there’s liquidity in the business and lack of a shared purpose,” he says. Even James Bond sometimes needs to bide his time and make slow, careful decisions rather than coming out with guns blazing.
Lesson 3: Good governance
“Beyond leadership, a family business needs a good governance structure,” Fleming adds. “How is the family going to make decisions?” Disagreements about how to invest and distribute wealth are inevitable; having a structure for dealing with these disagreements can help family members work toward consensus, he explains.
Working with a family office to structure decision making may not be as glamorous as the snap judgments an undercover spy might make, but it is more effective for managing wealth.
“Misunderstanding about direction can be incredibly destructive.” Working toward mutual understanding can offset disagreement, Fleming says.
Research that Stonehage Fleming has conducted backs up his point that managing the family well is even more important than managing its wealth.
“What’s important to families is developing leadership, the shared purpose, avoiding family rows and managing disagreements and engaging the next generations appropriately,” Fleming says.
Supporting next generations
A well-managed family will help its younger generations “be able to live their own lives but at the same time fulfill their responsibilities and obligations,” he explains.
“It’s all about family dynamics. That’s really what families worry about and what they should invest time in, parallel to managing their financial capital.”
A multi-family office like Stonehage Fleming needs to be prepared to be blunt and honest with the families it manages, Fleming says.
“If [our] own purpose is to really help families determine their purpose, then part of our role is to ask them challenging questions. One of the things we see a lot of families wrestling with is how to keep the purpose of the family office continuing through the evolution of the family through generations,” he says.
“It helps our firm because we have the authenticity of being members of a family that has done a lot of things right, but which has made mistakes, as well,” he says.
“If you look at our family tree, as well as being littered with brilliant people like Ian, it’s also littered with [members who have suffered] incapacity, illness, unhappiness. Our role is not to impose solutions for other families, but to help them come up with what the solution for their own future looks like,” he adds.
“Our conversations with families can involve tears and slamming of doors,” he says, but at the end of the process, families understand the need for working through the issues.
On a recent working visit to Canada, he met about 40 wealthy families. “They were not swanky,” Fleming says, adding that he means that as a compliment.
“They were just down-to-earth, hard-working families,” he says.
“We were struck by how, broadly speaking, the things the families we met worry about are the same things we worry about. And it’s not money,” he says.
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