Here’s a not-so-uncommon scenario: A business owner’s eldest son believes he should get the family business because he’s the oldest. But his sister doesn’t want to be passed over because she’s a girl. The father views the youngest son as the most capable, but he’d rather sell the business than deal with the family fallout.

While this may not be a situation worthy of a television series like HBO’s Succession, it’s a realistic one encountered by Patricia Armstrong, a senior director at the Institute for Family Culture at Abbot Downing, a wealth manager for the ultra-wealthy.

It’s also one of many that hits close to home for family-run companies started by entrepreneurial individuals who have a hard time thinking about what happens to their life work after they are gone.

“The way we try to mitigate that is by encouraging families to focus on the nature of the business and the skill set that a successful CEO is going to need and then being able to communicate about that,” Armstrong says. “You're not going to always have someone in the business who's ready.”

As the U.S.’s 70 million baby boomers move well into retirement and beyond, how wealthy families plan to pass on their wealth, and often their businesses, is a hot topic.

“This is the type of conversation that we have with our clients everyday and what we think about as a business,” says Alvina Lo, chief wealth strategist at Wilmington Trust, the Delaware-based private wealth manager.

Many of Wilmington Trust’s clients are baby boomers who have built businesses out of nothing and are at an age where they need to think about what happens to their companies and their wealth when they’re gone.

“They need help to not only structure a succession plan from a tax and legal perspective, but from a more softer, succession planning, ‘how do I talk about this with my children?’ perspective,” Lo says.

Not that patriarchs like the fictional Logan Roy, the head of the family depicted in Succession, don’t exist.

Rebecca Rothstein, a private wealth advisor with Merrill Lynch’s Private Banking & Investment Group in Beverly Hills, Calif., works with a family led by an 80-year-old patriarch with children from two of his three marriages, including his current wife. The patriarch has yet to tell the children, who are in their late 30s to late 40s, that they will be inheriting substantial wealth. In fact, he’s even said, “I’m not leaving any of it to you,’” even though he fully intends to, Rothstein says.

“Rather than teach them or have them involved, he controls,” she says.

That’s despite the fact that Merrill Lynch, like many private wealth managers, offers three-day boot camps for young adults to prep them on how to manage their wealth, careers, and philanthropic interests. The firm also offers plenty of guidance for clients on effective family governance, and early on will speak with clients about their intentions for their wealth.

How to do Succession Planning Right

The key is thinking through business and family-related topics well before a crisis, or even a smooth transition. One way families can do this is through a governance body like a “family assembly”—a large group that includes all family members—in combination with smaller boards or councils of family members who are ready to roll up their sleeves and do the day-to-day work of running a business, Armstrong says.

This smaller group can advise the larger one, she says. But she adds, family members need to realize that anyone with a beneficial interest in the business, for example, through a trust that includes shares they may inherit, has to be given an opportunity to be involved. “If they take a pass, then be explicit about how their input will be factored in,” Armstrong says.

It’s also good practice to develop a family employment policy that’s widely communicated and makes clear that being a family member doesn’t guarantee a job. Even a teenager contemplating an internship should read the employment policy and understand what is expected, she says.

One family Armstrong works with that’s in its fourth generation of running a business recently completed a family charter, a 25-page document that deals with everything from prenuptial agreements to the core values of the founder. The charter also spells out decisions that can be made by the corporate board, and those that should involve the family. For instance, “there's an emphasis on the family weighing in on a potential sale of the business,” she says.

Putting good policies in place is easier said than done when many business owners are more focused on running their companies than on the future. But changes to the U.S. tax code have created an opening for private wealth managers like Wilmington Trust to talk about planning ahead, Lo says.

The tax law passed at the end of last year doubled the federal estate tax exemption for a married couple to US$22.4 million. Wilmington Trust is recommending business owners take advantage of transfer tax strategies to move some or all of their business interests into a trust that will be exempt from estate taxes. Transferring these assets allows them to continue appreciating outside of the estate.

Because taxes “are front and center” now, Lo says, “it propels us to have this conversation.”