By Yusra Sarkar


Merely handing over wealth to the next generation is easy. What’s infinitely harder, and yet faced by more families? Handing over the family business in a way that sets the next generation up for success.

A family might need to consider more than simply handing over financial assets. Today’s wealth is generally complex, especially when one or more family-controlled businesses are involved.Tax optimisation, family dynamics and the multi-jurisdictional nature of the family’s wealth are also important considerations.

‘Choosing a successor and planning for wealth handover isn’t only a simple question of structuring. Increasingly, our clients need solutions that help set future generations up for success in more holistic ways. This is particularly important when a family has one or more businesses that generate significant revenue, and a family successor will take these over,’ says Mario Cohn, Managing Director, ZEDRA Switzerland.

A Private Trust Company (‘PTC’) could be the ideal solution. A PTC acts as a trustee of a specified trust or group of trusts which may hold businesses and assets in one or more jurisdictions. PTCs give more control than is possible in a traditional trust arrangement. Most importantly, family members can have direct involvement and provide strategic input into the management of the trusts and the assets, sitting on the board of the PTC alongside the settlor’s nominated advisors, business associates or other parties.

The result is that younger family members can cut their teeth overseeing family businesses and understanding the family’s wealth, alongside experienced, senior parties who can provide mentoring. ‘PTC’s offer efficiency, structuring for eventual succession and the opportunity to educate and teach successors how to approach and deal with family dynamics and understand the business, without exposing them to excessive stress or high expectations too early.’ says Mario.

As a professional trustee, ZEDRA handles the administration of the PTC and assists with its management if required. We also provide administration services to the overlying purpose trust or foundation, and to the underlying companies incorporated to hold the trust assets.

For very wealthy families, PTC’s also allow today’s successors to understand the long-term responsibility that comes with handling family wealth. ‘In cases where wealth is significant enough to pass through several generations, today’s settlor’s want their successors to understand how the different pieces of the puzzle fit together. The aim is that the next generation will be similarly proactive in the future, thinking about succession and the role they will play in passing on wealth in the future. A PTC structure also plays to this,’ says Mario.

For more information, please contact Mario Cohn, Managing Director, ZEDRA Switzerland.