Family councils are forums intended to increase intra-family communication and are increasingly utilized by family companies throughout the world. If used effectively, family councils may help to overcome problems such as poor communication and the inability to express one's opinion in the circle of the extended family. Family councils provide a framework for dialogue and therefore facilitate a free and open communication among family members. The family council may determine the prerequisites for family members with regard to employment in the company, it may prevent different perceptions by clearly revealing disagreements, resentments and expectations, it can eliminate family conflicts, and it may be used as a platform for creating a family constitution.
The establishment of a soundly functioning family council is subject to certain conditions. First of all, membership to the council must be open. It is common to see eligibility criteria for membership, such as age. The operational rules of the family council should be determined by the family.
Unlike a board of directors, the fundamental character of the family council is openness and wide participation. It is not a board of directors. Not all members of the family council should be part of the board of directors.
A family council may function slowly during the initial period following its creation. Families that are not used to frank and amiable communication may be shy about discussing sensitive topics at the beginning. In such cases an experienced psychologist may be helpful.
If the family council gathers regularly with a pre-determined agenda, it will strengthen communication among the family members. Establishing working groups within the council may help younger members of the family to prepare themselves for management responsibilities and enable the formation of new groups over time which may perform important tasks on behalf of the family.
