In this weeks episode we continue our look at Trusts and I speak with Cindy Radu about Trust Governance.
We spoke last week about the role that Trusts can play with the succession planning of a family business.
Your business will have some form of Corporate Governance that is set out from a legal perspective, alongside that you can introduce Family Governance to help set out the relationship between the family and the business.
In a similar way, the establishment of a Trust can be complex and the ‘rules’ of the trust are formally set out in the Trust deed which needs to be adhered to, alongside this you can introduce Trust governance that helps those interacting with the trust to understand elements beyond the legal and technical requirements.
This could take the form of a letter of wishes, not legally binding but acting as a guide to those operating the trust, however what we talk about on this episode goes beyond this.
In particular we explore the concept of a Trust Advisory Council.
Listen to the Episode:
Cindy is an expert in Trusts and has literally written the book on them. Her role now, amongst other things, is to help those associated with the Trust to have a better understanding of how to
This helps the parties related to the Trust to manage their relationship with the Trust, to help them to understand what the Trust can do. Having a Trust Advisory Board in place helped this family to truly understand the purpose of the Trust, beyond the legal definition of the purpose of the trust. Cindy uses a great example of a trust that had been established that, without her intervention, could well have missed the opportunities that it went on to provide for the family.
When Cindy spoke to the people associated with the trust, from a beneficial perspective, she was able to understand that there was a purpose to the Trust that went way beyond what they initially thought.
It was able to fulfil a purpose beyond the legal aspects and this came as a huge reassurance to that family.
In this example Cindy was also able to explain, in her roles on the Trust Advisory Board, how communication and financial education can be provided through the trust. Something that was really important to those involved.
An additional benefit was that it provides an independent adviser to the trust, and someone who can sit on ‘your’ side of the table in discussions with lawyers and accountants.
They are able to ‘translate’ the legal and tax aspects of those discussions and elevate them beyond a simple “sign here” exercise.
In essence Trust Governance allows those associated with the trust to have an objective third party working with them to ensure that the opportunities of the trust are maximised.
If you would like to speak to Cindy, you can find her on Linked In here: https://www.linkedin.com/in/raducindy/
Or you can contact her via her website – www.cindyradu.com