Charles Dickens opened A Tale of Two Cities with a paradox: “the best of times and the worst of times, wisdom and folly, light and darkness”. At first, it seems abstract. By the end of the book, the meaning is unmistakable, and it still speaks to us today. We live in an age of contrasts and nowhere is that clearer than in the way families approach their wealth.
For internationally minded families, wealth planning is a balancing act: protecting against risks on one hand, while securing capital and purpose for generations to come on the other.
Risks Driving International Wealth Structures
- Geopolitical exposureIn a globalised world, no family is immune to political shocks. Sanctions, instability, or sudden regulatory shifts can quickly disrupt wealth and investment strategies.
- Shifting family cultureChildren who study or build careers abroad bring new ideas, and often new partners, back into the family. This can broaden horizons but also test the values instilled by the wealth-creating generation.
- Lack of shared purposeCapital tied to a common purpose endures longer. When families lose that sense of purpose, wealth often shifts from collective stewardship to individual consumption, accelerating its decline.
- Capital erosion
Each generation carries the responsibility to preserve and grow wealth. Without engagement, education, and discipline, the rising generation risks spending capital rather than sustaining it.
How the Isle of Man Foundation Helps
The Isle of Man foundation has become a preferred tool for families seeking resilience. Created under the Foundations Act 2011, it combines features of both a trust and a private company but stands as a separate legal entity.
- Rules (akin to a private company’s articles) set the governance framework and capture the family’s guiding principles.
- The Council (like a board of directors) manages assets in line with these Rules, with room to balance executive and non-executive voices — and even representation across family branches.
- Achieving the purpose of the family and be built into the stated causes. The causes can be either charitable, provide for the family or a mixture of both.
- Flexibility allows founders to embed safeguards that reflect family values, while still adapting to future needs.
- Next-generation engagement is built in. Foundations provide a structured forum for successors to observe, learn, and contribute, preparing them for stewardship without forcing them into premature control.
ConclusionThe Isle of Man foundation acts as a practical governance vehicle: ring-fencing wealth, institutionalising family purpose, and engaging successors. In a world of contrasts, much like Dickens described, it is a structure that helps families turn volatility into resilience, and inheritance into legacy.