By Sarah Love.
While the United Nations estimates that family‑owned or managed businesses generate about two‑thirds of global GDP and 60% of jobs, a successful business is far more than an income-producing asset for many South African families. It represents years of hard work, family sacrifice and often forms the cornerstone of a family’s wealth creation strategy. Yet when a spouse who owns or manages that business passes away, families can find themselves facing an emotionally overwhelming situation compounded by complex financial and legal challenges.
At a time when family members are grieving, difficult questions arise. Who will manage the business? How will surviving family members access income? Is there enough liquidity in the estate? What happens to ownership shares? Without careful planning, a business that once provided financial security can quickly become a source of uncertainty.
This risk is not theoretical. PwC South Africa notes that only about 30% of family businesses survive into a second generation – a sobering reminder that succession planning is not merely an administrative exercise, but a business-continuity imperative.
Family businesses and concentrated shareholdings often create unique estate-planning challenges
One of the most common misconceptions among business owners is assuming that a valid will alone is sufficient. While a properly drafted will is essential, it forms only one part of a broader succession strategy. Family businesses and concentrated shareholdings often create unique estate-planning challenges because significant wealth may be tied up in an illiquid asset.
When a shareholder dies, the estate may require liquidity to cover estate administration costs, taxes and the needs of surviving dependants. If there is no plan in place to convert business value into accessible capital, family members may be forced to sell shares, dispose of other assets or seek funding at a difficult time.
The challenge becomes even more complex when family members rely on income generated by the business. If the deceased played a key operational role, the surviving spouse may suddenly face both financial uncertainty and concerns about the future management of the company. Questions of governance, succession and leadership can become urgent.
Proactive fiduciary planning can make a significant difference
A comprehensive succession plan should address ownership structures, shareholder agreements, key-person insurance, liquidity requirements and the future management of the business. It should also consider whether children or other family members have the skills, interest and ability to take on leadership responsibilities.
Effective planning is rarely just about legal documents
Comprehensive estate and fiduciary planning involves understanding the unique dynamics of each family and creating structures that align with their long-term goals. To navigate these complexities in the wake of a death in the family, engaging a fiduciary partner where technical excellence is complemented by empathy, collaboration and a genuine understanding of clients’ circumstances is key. A good adviser will communicate clearly, listen carefully and build lasting trust with clients.
The growing role of the female spouse in wealth management
Women are increasingly taking a leading role in wealth management decisions, whether through successful careers, entrepreneurship, inheritance or changing personal circumstances. Many want a deeper understanding of how trusts, investments and estate-planning strategies work so they can make informed decisions with confidence. This trend reinforces the importance of involving both spouses in business and estate-planning discussions from the outset – and becomes a lifeline when one spouse passes away.
The best time to plan for the transfer of a family business is long before it is needed. Succession planning is not an event but an ongoing process that evolves as businesses grow and family circumstances change.
The loss of a spouse is one of life’s most difficult experiences. While no financial strategy can remove the emotional impact, thoughtful fiduciary planning can provide some certainty, protect family wealth and give a successful business a better chance to support future generations. The National Wills Week will take place from 14-18 September 2026.
Sarah Love is CFP® FPSA® TEP, Director at Private Client Trust.