Many family businesses include shareholders who are not actively involved in the company's operations. Consequently, it is crucial to establish policies that address generating liquidity for these shareholders and effectively communicate them. Family shareholders have a keen interest in knowing whether they will receive distributions, as well as their ability to redeem or transfer shares. They also desire a voice in determining return expectations associated with share ownership. Successful businesses often emphasize the benefits of long-term ownership for family members, highlighting how patient capital can enhance both the value of the business and the well-being of the family over time. As a longstanding private firm with centuries of experience, SGI comprehends the delicate balance between reinvesting capital and providing returns to owners.

When collaborating with family business clients on matters related to distribution and liquidity, we assist them in addressing key questions, including:

• How have the family's expectations regarding returns and distributions been established? Is there a shared understanding of these expectations among all family members?
• What mechanisms are in place for orderly redemptions of shares? How is the valuation of shares determined, and how frequently is it conducted?
• What role does the family play in determining debt levels, risk parameters, and other operational aspects of the family business?
• Do the current leaders engage in open discussions about liquidity matters with all shareholders?