Succession Planning Is Not an Accountant’s Problem

What we fail to understand about Succession Planning

Ask ten Indian families what succession planning means, and nine will describe a division. The flat to one child, the fixed deposits to another, the jewellery by a list the mother keeps in her head. The exercise is treated as a logistical one — an allocation of things between people, to be done carefully but not thought about too often.

This description is not wrong, but it is incomplete in a way that gets families into trouble. It leaves out almost everything that makes the exercise difficult in practice.

Succession Planning is the deliberate organisation of passing wealth, obligations, and values across generations. It extends beyond the simple handover of assets, emphasising family unity, business sustainability, and safeguarding one’s legacy.

Read that carefully. Five things are being transferred, not one. Wealth is only the first. The other four — obligations, values, family unity, and sustainability — are the ones that actually decide whether the plan survives the people who wrote it.

Consider what the narrow “division of assets” view misses.

It misses responsibility. Who looks after the elderly aunt who has always lived with the family and cannot fend for herself? Who signs cheques for the family foundation? Who sits across the table from the bankers when the business needs a line of credit? These are not assets to be distributed. They are duties that must be picked up by someone specifically identified, or they fall to the ground.

It misses values. Families with money often discover that the hardest part of passing it on is not the tax or the paperwork. It is the question of what the money is for. A family whose elders believed strongly in education, philanthropy, or a particular line of business rarely wants those commitments to dissolve the moment the next generation inherits. But commitments do not transfer by themselves. They transfer by being written down, by being modelled, and by being embedded in the structures that hold the money.

It misses harmony. Every family lawyer’s practice contains the same sad pattern: a patriarch who waited too long, died intestate, and left behind children who had been cordial for forty years and were in court within four months. The legal division of assets, done coldly by the statute, rarely matches what any family member thought was fair. And once the court is involved, “fairness” stops being a family conversation and becomes a fight between affidavits.

It misses business continuity. Indian family businesses are often dependent on one or two people whose judgment, relationships, and personal creditworthiness hold the enterprise together. The question of who replaces that person, how, and when — and what happens to the business in the six months while that transition is happening — is rarely addressed in a plan that thinks only in terms of “who gets the shares.”

Consider a hypothetical Pune family. Imagine the Kulkarnis. The father, Suresh, runs a mid-sized engineering firm. He has three children: a daughter in Mumbai, a son in Pune working in the business, and a younger son in the United States. He has a widowed sister who has lived with the family for twenty years and depends on him. He has a long-standing commitment to fund the local school where he studied. And he has, like many founders, an informal mental plan that goes: “my Pune son will take over, the others will get money.”

If Suresh dies without having done more than think this plan through, here is what actually happens. The statute of intestate succession divides his assets in fixed shares that may or may not match his wishes. His widowed sister has no statutory claim on anything and may find herself dependent on the goodwill of the inheritors. The school commitment evaporates. The Pune son, even if he has been running the business alongside his father, has no automatic legal authority to continue doing so — he is one of several equal inheritors of the shares. The Mumbai daughter and the US-based son, who have no interest in running the business, suddenly have voting rights in it.

Every one of these problems could have been addressed while Suresh was alive. None of them are solved by “who gets what.” They are solved by thinking about responsibilities, values, harmony, and continuity as separate questions and building the plan around all five dimensions.

This is why “succession planning” is a misleading phrase if you read it narrowly. The phrase is really a shorthand for something larger — a structured conversation about everything a family owns, owes, and stands for, and how those things will move from one generation to the next without breaking.

The practical takeaway is not to write a will and be done. The practical takeaway is to recognise that a will, by itself, addresses only one of the five dimensions. A private trust can address more of them. A family constitution, a thoughtful choice of trustees, a letter of wishes, a clear plan for who takes which responsibility — each of these tools exists precisely because the narrow version of succession planning does not cover the ground.

If your plan consists only of a list of who gets what, you do not yet have a plan. You have an allocation. The plan is the part that thinks about everything else.

A family transfers five things across a generation, not one. Any succession plan that thinks it is only about the first has already failed the other four.