Fiduciary asset management : As a means of founders’ transgenerational succession strategy

Abstract

The 1990s generation of the fall of communism has reached retirement age by now, so the time has come for a generational transition. Studies on the succession of family enterprises mainly focus on internal factors such as professionalisation, involvement of external managers, successors’ socialisation, or the issue of asset values. However, the institutional environment shaping succession options including inheritance law, formal intermediaries, succession-related tax rules also have a major impact on the long-term survival of family businesses and the transfer of wealth from one generation to the next. The objective of this paper is to shed light on the peculiar features of family enterprises and their internal factors defining succession alternatives in this country. It intends to describe the formal set of institutions and the relationship between those institutions, transgenerational wealth transfer, and succession strategies. In the case of mixed exit strategies, it analyses the options, advantages, and risks of the application of fiduciary asset management as one of the “wedges of asset management” between the principals of family enterprises and the managers.