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Psychological safety and the Family Business


I am an avid reader and researcher, especially of things that intrigue and get me thinking. So last week, I was watching a YouTube video of Anssi Rantanen at the Nordic Business Forum, and I was captivated by his presentation at the Nordic Business Forum. He explained psychological safety in such an intriguing and practical way. It kept me thinking bout it all day, more so on how it affects those who I work with in the family business forums and consults.


Creating family governance structures is a critical procedure, but as with many things, resistance is met when change is necessary. Armed with my new knowledge, I found out some interesting facts and snippets that I believe would be necessary to explore as we look into how psychological safety may affect the family governance space:


What is psychological safety? "Psychological safety is a belief that one will not be punished or humiliated for speaking up with ideas, questions, concerns, or mistakes."

"Psychological safety is being able to show and employ one's self without fear of negative consequences of self-image, status, or career."


Now honestly speaking, how many times have you felt psychologically safe on a group of people? This journey of feeling unsafe is started early in life due to the educational system most of us have experienced where we learn in a classroom of our peers (in most instances). In the classroom space, we are from a young age taught that only the "right" answer or the "logical" or "normal" answer would be accepted and praised by the group. And in this space, similarly so, norms that are led and controlled by the teacher are encouraged and perpetuated.


Taking it even further, this process actually starts in the family home. From birth, child is taught by the family group what is accepted and what is not, and that which is not deemed the "norm" or "acceptable" is frowned upon by the parents or guardians and ultimately the rest of the group. And in this space, a child learns what we call EQ or Emotional Intelligence.

Emotional intelligence (otherwise known as emotional quotient or EQ) is the ability to understand, use, and manage your own emotions in positive ways to relieve stress, communicate effectively, empathize with others, overcome challenges and defuse conflict.


What we deem as EQ may also be a situation where individuals are not feeling Psychologically safe and then conform to the "norm" due to fear of failure.


There is a lot of research being done now to explore how to create effective teams by creating spaces where they feel psychologically safe. And similarly so, I would like to share with you how I believe it is necessary to create such spaces on the family governance space because ultimately the family is a team that is expected in many situations to work together in ways that advance the family interests especially those with a family business.


According to Amy Edmondson, a leading Harvard Business School researcher on the topic, psychological safety, Psychologically safe team members "feel confident that no one on the team will embarrass or punish anyone else for admitting a mistake, asking a question, or offering a new idea."


Firstly let's explore why psychological safety is essential in family governance. Family is often made up of different individuals who share a commonality; however, it does not make the group homogeneous; contrary to expectations, each individual in the family is exactly that, an individual. They are affected and react to different situations and ideas differently. The shared commonality may be the values the family upholds as a whole, but more so in a situation where the family must create a family governance tool like a family constitution, it is imperative that every voice is heard.


How can every voice be heard? When establishing the need for a family constitution, parameters must be put in place to create spaces that allow for psychological safety for all family members. In most cases, a family may not realise that certain members of the family do not feel safe or comfortable sharing their ideas and thoughts, and therefore they don't share valuable information that may transform the process into one that creates a robust constitution for the family. In such cases, it's vital for the family to bring in an advisor who has experience in walking families through the process who can alleviate and create spaces where all family members are heard and contribute to the process.


Important information and contributions are lost when individuals who are part of the family do not participate in its growth process or its governance process. There is a high possibility that those members who feel less represented or feel like they did not participate in the process wholly will not uphold the Family Constitution, and they instead see it as a document for other family members, which is not inclusive of them. This is mostly because their contribution is not heard during the creation of the constitution, and therefore they went through the process because it had to be done but did not commit to the contents of it.

Such an example is, in most families, it is the norm that the family is headed by the firstborn male son. More so in the cultures and norms of Africa. This individual is deemed "Baba" or "Father" at birth. And this, with a number of other cultural norms do not always fit positively into the family business success. Without a family constitution clearly outlining how business succession is going to work, you may find that the nominated individual is ill-suited to the role or is not interested in the position of head of the business. But, when the family Constitution was being created, no one, much less the sisters, spoke out sharing ideas on how or what should be done in terms of succession to build a stronger family and family business. The reason most will not speak out is because if there is no psychological safety incorporated in this space, it's no longer a binding Constitution but a list of rules instituted by the powers that be which will only lead to conflict at a later stage because there was no full honest participation by all members of the family.


Vulnerability in the creation of Family Governance can take many different forms, including:

  1. Speaking up in a family meeting to propose a risky or untested idea.

  2. Admitting to the family that the project you championed failed, and offering lessons learned in the process.

  3. Disagreeing with a member of the family, especially a senior member or offering a different way forward than they'd previously considered.

  4. Willingly giving up time or resources to help out a family member, taking away from the resources you have to achieve your own goals.

  5. Sticking up for a family member in the face of adversity from other family members.

  6. Volunteering to do something you have no idea how to do Showing emotions to the family when you're under pressure or stressed out, especially if you are seen as the authority.

  7. Any of these acts leave you open to criticism, failure, the always dreaded negative feedback from family. They are vulnerable acts because they rely on the belief that others will give you the benefit of the doubt when you're taking a risk.

In the creation of the Family Constitution, it is necessary to understand the dynamics of different characters in the family group and create atmospheres and spaces where each personality can contribute without having to utilise the inhibitors of EQ with every instance but can instead feel comfortable enough to share and contribute honestly to the process.

This extract from the New York Times Magazine article on Google's perfect team quest sums it up perfectly:


"No one wants to leave part of their personality and inner life at home. But to be fully present at work, to feel "psychologically safe," we must know that we can be free enough, sometimes, to share the things that scare us without fear of recriminations. We must be able to talk about what is messy or sad, to have hard conversations with colleagues who are driving us crazy. We can't be focused just on efficiency."


This sums up the same necessity for the family going forward in building family governance structures. To be wholly successful, it is necessary that family members are given a space they are able to talk about those things that are deemed" hard" or" difficult." Because it is in these conversations that conflicts are resolved or tackled in constructive ways. Issues that normally would be concealed and can cause later conflict will be addressed, and inclusive resolutions are created. Individuals may feel nervous and feel uncertain at first when psychologically safe spaces are being created because they are not a "norm," however, as you can see, it's really important we create these spaces where it should be a norm.

Four tips for fostering psychological safety in your family governance process:


Lead by example

Those leading the process should set an example for the rest of the company. If done properly, the set of behaviours should become a norm for the other members of the family. Acknowledging your mistakes and being open to opinions that differ from your own allows an atmosphere of safety and respect.


Encourage active listening

This is an integral part of ensuring people feel valued and that they can contribute to the family. Ideas to improve listening include:

  • Leave phones at the door during meetings

  • Show understanding by repeating what is said

  • Encourage individuals to share more by asking questionsIf certain individuals rarely speak during family meetings, actively ask them for their opinions


Create a safe environment

One of the keys to psychological safety is that people feel comfortable voicing their opinions and do not fear being judged. A family can develop a safe environment by creating a few ground rules on how they interact with one another. These could be, for example:

  • Not interrupting each other

  • All ideas being accepted equally and never judged

  • Never placing blame

  • Encouraging and listening to Out of the box suggestions


Develop an open mindset

In order to break free of judgment and strengthen the relationship between family members, it's essential to have an open mindset. Often we look at things from our own lens, but approaching them from a different angle can help bring perspective.

  • Encourage family members to share feedback with one another

  • Help family members to learn how to respond to input from others

  • Rather than criticism, encourage family members to see feedback as a way to strengthen and build upon their ideas and processes.


What creates success is our human spirit, and it's ability to endure, and it's ability to be creative. What destroys success is our human ego that's driven by emotion and blinds us to rationality. Creating Psychologically safe spaces does not come easily to us as humans as we want to judge whilst not being judged. What will make us maintain and intensify our success is leaving our egos and judgements at the doorstep and instead embrace objectivity, exclusivity, and empathy.

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