It turns out the one percenters are just like us. Or, to put it another way, we're just like the one percenters, as the riveting HBO TV series "Succession" has revealed for the last four seasons.
The final episode of the series, which follows an ultra-wealthy, ultra-dysfunctional family who owns a multibillion-dollar conglomerate, aired on Sunday night.
"In a lot of ways, 'Succession' is a grand example of things that are playing out in many American lives and American businesses," argues Monique D. Hayes, a bankruptcy attorney and partner in DGIM Law, in an interview with ThinkAdvisor before the finale.
"It's an absolutely accurate depiction of what happens in a business if there's no clear succession plan … and when people allow their family dynamics, grudges or disputes … to override business decisions," says Hayes.
Ambition, power plays, backstabbing — this is the stuff of "Succession," at its core, a cautionary tale exposing the mega-wealthy and deeply flawed Roy siblings, scions to the huge family business. After the death of family patriarch Logan Roy, who among the young Roys — Kendall (Jeremy Strong), Siobhan, aka "Shiv" (Sarah Snook) and Roman (Kieran Culkin) — will head the empire that he built from scratch?
Alas, Logan hadn't established a succession plan, which sparks an epic power struggle, replete with infighting, deceit and betrayals.
Indeed, in the real world, succession struggles are commonplace and widespread. "If you don't have a succession plan, you're planning not only for failure but for chaos," Hayes, experienced in asset sales and acquisitions and fraud litigation, among other financial areas, maintains in the interview.
Without a plan, the stage is set for "exploits and oftentimes betrayals," the attorney points out. Hayes, who often develops succession plans with clients, discusses lessons that financial advisors can learn from the TV show — which was created by Jesse Armstrong — to help their business-owner clients, in particular.
She also delves into the succession issue, among others, with respect to the "great wealth transfer" from baby boomers to the next generation.
In the interview, Hayes, co-chair of the American Bar Association's Business Law Section Chapter 11 Subcommittee, provides specifics about setting up a succession plan for a family business and what to do if no family member is seen as equipped for the top job.
The lawyer also emphasizes the repercussions of failing to have a will. As many as 77% of Americans do not have one, she says.
Hayes spoke Friday by phone from her firm's base in Miami.
The attorney adroitly related the quest for power by the Roy siblings, each obsessed with wanting to run Waystar Royco, to those same struggles in the real world.
Here are highlight from the interview.
THINKADVISOR: "Succession" was a fictional TV drama series studded with black humor. How does it compare to real life?
MONIQUE HAYES: In a lot of ways, "Succession" is a grand example of things that are playing out in many American lives and American businesses. There are a lot of similarities and a lot of lessons.
What does "Succession" get wrong about succession planning?
I think it gets a lot of things right. That is, it's accurate in terms of what happens. It's an absolutely accurate depiction of what happens in a business if there's no clear succession plan. It's an accurate reflection of when people allow their family dynamics, grudges or disputes over the years to override business decisions — they can't get over what happened when they were kids.
What's a key takeaway for financial advisors to help their business-owner clients?
The first thing is that it's important to have a succession plan. If you don't, you're planning not only for failure but for chaos.
Logan Roy, the patriarch on "Succession," didn't have a succession plan. That made for a big mess because his children were vying for power [to become head of the company].
Any time you gather ambition and family dynamics as well as business objectives, if there isn't a structured plan and design not only about the company's operation but the ownership and for how it's going to be transferred, there are exploits and oftentimes betrayals.
You find people betraying the mission of the organization for their personal ambition. That happens in a corporate setting or any other scenario where you have human interaction and competition.
What's an example of a betrayal on "Succession"?
The brothers Kendall and Roman have decided to be [temporary] co-CEOs and told their sister Shiv that she would be looped in on all major important decisions, that they weren't going to cut her off. But they did that exact thing when they decided to obstruct the sale of the family business. They didn't tell her.
She finds out, feels betrayed and starts angling and supporting their competitor, giving them information that impacts the negotiation.
Again, there should be a proper and well-documented succession plan. You want to have trusted advisors within and outside the organization who understand what the plan is so that there's no question about subsequent change.
You may decide to include the designated successor in the plan, but even if you don't want to disclose to the person the extent of their succession, you absolutely want to have it documented.
What should the owner focus on in establishing the succession plan?
Taking an honest look at who is in the organization today and the skills they have to carry it [forward], the temperament they've demonstrated in terms of leadership, the trust they have [instilled] among the other key employees and with relationships with outside parties, like lenders and vendors.
It has to be someone that's going to command respect and trust.
What if no one fits?
Sometimes you do find you don't have anyone that's ready today to fill that shoe. Then the question becomes whether you're going to develop someone internally or plan for an outside person to come in with the skills, acumen, trust and commitment to the mission that you, the patriarch [or matriarch], and the board of directors think is necessary to carry on the organization.
Would the board have agreed with Logan's choice, if he'd made one?
There was always the assumption, because of everyone's respect for Logan, that both the board and the rest of the family would have yielded to his pick.
He had such dominance over them that they would have yielded, or he would have forced their submission, as he'd demonstrated [in business] because of his ability to outthink and outstep even the kids.
The problem is, he didn't even know. He hadn't made the final decision at the time of his passing.
When Logan suffered a stroke, the company's stock dropped: People thought he might die. What's the danger when the company head overtakes the organization in importance?
If you're a public company, your constituents should be confident that there's a team of people that keeps the lights on, the business running, that there's no one person that's wholly responsible for the success of the entity.
If the business is wholly dependent on one person for its success, that's a problem.
Can you cite any real-life scenarios that address this?
Often, when a dynamic person heads an enterprise, people associate it with that person. Right now, Jamie Dimon [chairman, CEO] of JPMorgan Chase is an example of that. People want to know that there's going to be a designated succession plan.
Michael Bloomberg [former mayor of New York and co-founder and CEO of Bloomberg] has been very vocal about the importance of succession.
