At a glance
- Family closeness can fuel friction, especially during leadership transitions and succession planning.
- Common flashpoints include disagreements over technology, risk appetite, and the succession process itself.
- For accountants acting as advisors, early, structured conversations are key to balancing business continuity and family harmony.
Family businesses account for 70% of all companies in Australia and employ half the nation’s workforce, according to the Family Business Association. These enterprises are typically built on trust, shared values and strong personal ties.
But that same closeness can also fuel intergenerational friction, especially during times of transition. Succession planning in particular can expose conflicting views on when leaders should step back, who should take over, and how a business should evolve.
Adrian Misiano, partner at Matthews Steer Accountants and Advisors, has spent nearly 27 years advising family businesses. “You can have the most well-designed processes and outcomes on paper, but when you throw in the other ingredient, which is emotion and personality, that throws all the other stuff out the door,” he says.
Misiano says external advisors such as accountants can play an impactful role in easing intergenerational tensions. But doing this well requires more than financial expertise. Good succession planning is about “reading the room and understanding personalities, goals, and what will make people happy,” he says. “There are a lot of soft skills that come into play, because even having the best technical advisors in the room won’t necessarily fix it.”
Common family flashpoints
Intergenerational conflict can arise over any number of business decisions, from big-picture strategy to the smallest operational details.
Often, the tension isn’t just about the task at hand, but what it represents: a shift in control, a challenge to tradition, or a different vision for the future. Left unaddressed, these differences can compound into resentment and stall a business at critical moments.
Misiano often sees disagreements ignite at these three flashpoints:
Technology
Younger family members tend to push harder for digital upgrades – such as cloud platforms, automated workflows or modern comms tools. Older generations may see them as unnecessary or disruptive to a system that has ‘always worked’.
“This is frustrating for a generation who want to get up to speed with other businesses and be more competitive,” says Misiano. “The problem is that trying to get up to speed and be more competitive involves investment. And when the parents see that profitability is dropping, or cash flows are dipping because we’re putting money into something, then there’s often panic.”
Risk appetite
Founders often prioritise protecting what they’ve built, while younger generations might be more comfortable taking on debt or pushing for growth. Particularly when family finances are involved, these tensions can escalate quickly.
“Most of the time, the parents are still the shareholders and are still holding that risk,” explains Misiano.
“When you throw in… emotion and personality, that throws all the other stuff out the door.”
Adrian Misiano, partner, Matthews Steer Accountants and Advisors
Succession
Succession is often the most sensitive issue in family-run businesses. KPMG’s latest Family Business Survey reports that less than 40 per cent of Australian family firms have a formal, documented succession plan in place. And even when a transition plan is in place, a lack of clarity around leadership, decision-making and timing can lead to confusion and resentment.
“In some of the businesses I’m working with, the parents say they want to retire, but I’m not sure they really do,” says Misiano. “They’re constantly in and out. And that can put a bit of pressure on the next generation – because one minute, they’re the decision maker, and the next minute they’re having to try and get decisions approved by the parents.”
The accountant as conflict manager
When it comes to succession, the initial challenge is often getting families to talk about the future before urgency forces the issue, says Misiano.
“The biggest thing to get succession planning right is clarity on what people want to do. And that’s about having the right discussions at the start and understanding what everyone’s plans are,” he says. “It could be a 10-year process. But let’s start it early, even if it’s just really light discussions.”
The longer these conversations are delayed, the more complex the situation can become. If founders pass away without a clear plan in place, the resulting conflict can cause disputes that stall a business or put its future at risk.
This often occurs in instances where not all family members are involved in the business day to day, says Misiano.
“Nine out of 10 times with next generation family businesses, not all the siblings are involved,” he says. “And what sometimes happens is that the siblings who aren’t involved want a bigger claim than they’re entitled to … then, succession planning can turn into estate planning.
“One of the things I suggest is that, once the parents have gone, there’s an annual family meeting. And I would sit in as someone independent who can [ask questions like], ‘How much can we afford to pay out? And can we afford to pay out without starving the business?’”
Approached with the right mix of structure and sensitivity, these conversations lay the groundwork for long-term stability – both financially and interpersonally.
“One of the things I like doing is having individual discussions first with each of the stakeholders, and understanding where their plans are and what they’re striving for,” says Misiano.
“And then it’s about bringing together a plan that I think is fair and will help. But that plan needs to be really open, because it’s not my decision. So it’s really about facilitating the discussion for the family, rather than saying, ‘This is how we’re going to do it.’”
Balancing continuity and change
Family businesses thrive because they combine commercial focus with long-term stewardship. But their endurance depends on making the handover between generations less fraught and more deliberate. Accountants – often the most trusted external voice – can provide structure, perspective, and calm when family dynamics spill into business decisions.
The real test for these businesses is not just profitability. It’s also whether one generation can hand over the reins to the next without damaging family bonds in the process.
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