Carolyn: I Want to Help the Second Generation Cry Out Their Voice

“I even want to help the second generation cry this voice out.”

When she encounters cases of generational conflict within families, Carolyn often feels a deep resonance, as if she sees her own reflection. She asks: why can’t one do the things one longs to do?

She understands how great the expectations and pressures are that the second generation bears as they grow up, and she hopes she can play the role of a bridge, helping the second generation “cry out.”

As a partner at Flourishing Tree Family Office, Carolyn tends to pay closer attention to the feelings of the second generation when serving family clients—something she sees as the way she complements the other partners.

In her conversation with Chinese Family Wealth, Carolyn shared many of her insights on family succession—some from her observation and reflection, others from her own life experience.

Carolyn hopes the voice of the second generation can be heard, but she can also understand the thinking of the first generation, because the road of building a business is one of near-death and hard survival; the first generation hopes the second can take fewer detours, and so they “design” a road for them.

Out of care for the second generation, the first generation believes that marital risk is the greatest risk in family succession; they do not want their children to suffer a double harm—of both people and money.

Unlike the first generation, the second sees the greatest risk as the failure to separate the family from the business; they hope their parents will strip business risk away, so as to avoid additional harm.

Carolyn says the two generations focus on different things, but the original intention of both is love for the other. Only by understanding this can one better grasp the true heart of family succession. What follows is a record of the conversation.

Hoping the Second Generation Is Heard

Q: How do you view the conflict between the first and second generations of a family?

Carolyn: When I communicate with the first and second generations together, I tend to pay closer attention to the feelings of the second generation. Perhaps it’s because of age and the environment I grew up in—I’m about the same age as today’s second generation, so the expectations and pressure they experience from the first generation as they grow up, I feel deeply too.

In many of the second generation, the first-generation parents have given both high expectations and a fine grounding in education or values, but along with that come pressure, control, and a sense of oppression. When I see the second generation caught in these emotions, I resonate with it at once. I often hope that when this state shows itself in a member of the second generation, they can be heard and understood. I hope I can play the role of a bridge in the middle, so the second generation can relax a little.

In fact, I sometimes do a small piece of work: I try to understand the second generation and help them sum up why they are in such a state. What lies behind it? Sometimes when they are caught in that state, they can’t articulate it, and so they can’t solve the problem. I hope to do this work first.

I went through the same thing with my own father; sometimes there was a sense of conflict too. Between the ages of ten and twenty, my parents gave me the best education and a very fine input of values, and I may have grown into a relatively outstanding person of this era. But at a certain point—say, when I became an adult and faced society—there was a swift switch: my parents immediately wanted me to become independent, responsible, and able to carry the load. At first I didn’t even catch up with it—why had my parents’ expectations of me changed like this? I found it a little hard to bear that switch and those high expectations.

When I look at many of the second generation, especially the only children among them, the high expectations from the first generation weigh on them. For instance, a child may love studying law, or some specialized art or discipline, but the first generation wants the child to come and take over the business—and so conflict arises. When I encounter such cases, I put myself in their place, as if I see my father speaking to me, feeling: why can’t I do what I want to do? I even want to help the second generation cry this voice out.

Understanding the First Generation’s Pains

Q: How can the first and second generations understand each other?

Carolyn: Looked at the other way, the first generation’s thinking is easy to understand too. The Reform and Opening-up came in 1978, and many people began building businesses in the 1990s. Looking at the twenty years from the 1990s to 2010, you could say the first generation went through blood and storm. Why do the first generation so often hold such high expectations of the second? Because they know the road of building a business is one of near-death and hard survival, extraordinarily grueling, and they don’t want their children to go through such a great ordeal again—so they hope the second generation can avoid the pits they fell into.

And so the first generation always designs a road for the second to walk. In the first generation’s eyes, this road may be a broad avenue with fewer pits. But in the second generation’s heart, they feel: I don’t want a road that’s been designed for me, so I resist with all my might, and in the process of resisting, confrontation and conflict take shape. From my own experience, I feel this deeply.

My father ran a business for a time. People of his generation often had many siblings; supposing the first-generation member is the most capable in the family, or the one with the strongest sense of responsibility, they also have to bear the pressure of the family’s other members—so there are two burdens, pressure from both family and enterprise. Later I began to reflect: why did my father show up the way he did? I often felt the world was so much fun, so interesting, every day full of sunshine—but my father would suddenly make me feel how heavy life was, and that was because he carried what I did not. Then I thought it the other way around, and considered my father’s whole life as a whole: if I were him, I too would be very unhappy. Thinking this way, I could understand him. In truth, my conflict with my father was never confined to what we now see between the second and first generations. I had to resist it—why? If I didn’t resist that sense of control, my personality would be swallowed up; it was the black hole in my heart, and I had to resist. But I also hoped that whatever I did could win his approval; there was always a small voice inside me saying, can’t you approve of me? Can’t you give me a hundred out of a hundred?

It is precisely because of these experiences that I can resonate with the state of so many in the second generation, and I also hope they can sometimes think about things from the first generation’s standpoint—only then can they truly understand the first generation.

What Does the First Generation Care About?

Q: How does the first generation view the risks of succession?

Carolyn: Over the past year I’ve seen so many first- and second-generation members come and go. Because of the nature of our work, when the first generation sits down to speak with us, they touch on some business-related topics. A family office, for instance, may take many forms—some do security-oriented structuring, some do wealth management and asset allocation. We assumed that when the handover to the second generation comes, their greatest need would be insulation and protection—and the second generation guesses the same.

But in actual communication, when you put all three risks on the table—separating the family from the business, preserving existing wealth, and wealth dispersion caused by marital risk—you find that the first and second generations perceive the greatest risk entirely differently.

Among these three risks, what the first generation cares about most is marital risk. This is our quiet observation—a hidden thread rather than an obvious one—and it differs from what institutions assume. From a professional standpoint, one might think separating the family from the business is very important, because the first generation is the one who creates wealth, so above all there must be no risk on them; hence the wish to insulate them completely from risk.

But when all the risks are truly laid on the table, the moment the first generation hears of it, the first thing they express is: if in the future the person their child marries treats the child badly, or even, by some improper means, causes the child’s entire fortune to scatter, that is something they absolutely cannot tolerate—because it causes a double harm of both money and people.

We saw this hidden thread: when all the risks are laid on the table, the first generation often does not weigh which of the objective risks is larger or smaller; their first thought is, I cannot tolerate anyone treating my child badly or harming my child. They believe the wealth dispersion caused by marital risk is a great harm—not only a loss of money, but the behavior behind it, which they cannot tolerate and see as vile. I think this is the first generation’s thinking.

What Does the Second Generation Care About?

Q: Does the second generation see the problem the same way?

Carolyn: For the second generation, the sense we get from speaking with them separately is that, on this question, they may be more rational than the first generation—they feel that separating the family from the business is the greatest risk, and this is also the greatest risk they perceive on the first generation. Later I reflected: in the second generation’s eyes, the first generation is the one who creates wealth; they really are too deeply bound up with the enterprise, and in the course of building it they have put everything the family has into the business—the family and the enterprise truly are inseparable.

What this implies, in fact, is that the second generation loves the first: what they attend to first is that my parents need to strip risk away, and so the family and the enterprise must be separated. Looked at the other way, the first generation, too, out of love for the second, places greater weight on the second’s marital risk. The two generations focus on different things, but the original intention of both is care for the other.

In Closing

At present, the development of family offices still centers on the allocation and succession of a family’s financial capital. But we firmly believe that “the continuity of the home and the happiness of the people” is the true code of family succession. We hope that the design for protecting and passing on wealth has, as its ultimate goal, service to “people.” We want to be a family office with warmth, doing our best to help the first and second generations see, hear, and understand each other’s hearts.

Carolyn

Partner, Flourishing Tree Family Office

MBA, University of Southampton, UK

ACCA member (Association of Chartered Certified Accountants)

CFP (Certified Financial Planner)

STEP Affiliate (Society of Trust and Estate Practitioners)

Comment to Win a Book

There is a book we would like to recommend for the first and second generations of a family to read together—The Voice of the Rising Generation, in which it is written:

Many families, in China and abroad, in the course of succession often see their financial assets slip away and the family fall apart because of a failure in human capital or spiritual inheritance. In this round of family succession in China, both those who pass on and those who receive are new to the road, without experience. Though “the road is long,” we look forward to a journey “full of miracles, full of discovery.”