Family Ownership Group – The group of family members that own the family business. In some cases this can be synonymous with Shareholder Group.
Shareholder Group – The group of shareholders (owners)
Shareholder – An individual or a group (including a corporation) that legally owns one or more shares of stock in a company. Shareholders are considered legally separate from the company and are generally not liable for debts of the company.
Board of Directors – A Board of Directors is organized and functions according to laws of the jurisdiction in which the business is organized. Members are generally elected by the shareholders with the task of governing the company in the best interest of the shareholders.
Board of Advisors – An Advisory Board is neither required nor governed by law, so it can be operated in any manner that the family might want, perhaps voting on some (but not all) particularly key issues or offering non-binding, strategic advice but not actually voting on a decision.
Strategic Plan – A document that articulates both the decisions made about the organization’s goals and the ways in which the organization will achieve those goals. The strategic plan is intended to guide the organization’s leaders in their decision-making moving forward.
Management Team/leadership team – The group of individuals that operate at the higher levels of an organization and have day-to day responsibility for managing other individuals and maintaining responsibility for key business functions.
The management team is also generally responsible for putting together the business strategy and ensuring the business objectives are met. The Management team are held accountable by the company’s board of directors.
Some organizations may operate a fairly flat team hierarchy with one or just a few layers of management while other companies may operate with several layers of the management team.
Estate Plan – A document that details how a business owner’s money and assets will be divided upon death. Estate planning helps ensure that the right people inherit your business and enables you to minimize taxes during the transition while avoiding legal messes.