Succession in family businesses represents one of the greatest challenges faced by Brazilian entrepreneurs, especially in small and medium-sized companies. In Brazil, these companies account for a significant portion of the economy, contributing heavily to job creation and the strengthening of productive sectors.
According to data from the Brazilian Institute of Corporate Governance (IBGC), around 90% of Brazilian companies are family-owned, but only 30% make it to the second generation, and less than 10% survive into the third. This high failure rate is not solely due to financial viability or market competitiveness, but rather to the lack of structured succession planning and governance mechanisms capable of aligning business and family interests.
What sets family businesses apart is the combination of two distinct worlds: the corporate, governed by goals, results, and competitiveness; and the familial, rooted in emotional bonds, shared histories, and informal hierarchies. This blend can be a powerful force, fostering cohesion and long-term commitment, but it can also become a weakness when personal conflicts, rivalries, or diverging expectations interfere with strategic decisions.
Thus, it is common for the founder to concentrate not only leadership but also relationships with clients and suppliers, technical knowledge, and the strategic vision of the business. Without adequate preparation for succession, their absence can leave difficult-to-fill gaps, opening space for internal disputes, capital fragmentation, and, in some cases, even the dissolution of the company. In this context, succession should not be limited to the transfer of ownership. It must also involve preparing future managers, defining a clear organizational chart, and implementing objective rules for decision-making.
It is important to note that not all heirs are interested in or suited for leadership roles, and appointing unprepared individuals can compromise the company’s competitiveness. Therefore, succession must be seen as a gradual process, combining legal and administrative measures with a governance strategy.
Among the available tools, the will stands out as an instrument that goes far beyond a simple act of last will, as it allows the founder to dispose of up to half of their assets (the available portion, respecting the forced heirship of necessary heirs) and to define, in a legally binding way, who will take over leadership, under what conditions, and with what limitations.
In the business context, the will can include criteria for choosing the successor, such as prior experience, academic background, or years of service in the company. It may also impose restrictive clauses to protect quotas or shares from being sold, pledged, or shared with a spouse.
In summary, the will, within the context of family businesses, serves a dual purpose: (i) the classic function of asset disposition, organizing the division of assets and rights; and (ii) the strategic function of regulating the succession of power, legally defining who will take over the company and how. It is this second function that elevates the will to a true instrument of business continuity, allowing leadership transition to be planned and aligned with the founder’s strategic vision.
For this reason, the drafting of a will should be done in advance and during a time of stability, with the support of specialized professionals who can reconcile legal expertise with an understanding of the complex family and corporate relationships involved. A poorly structured will, or one that disregards legal limits, can undermine the entire plan, generating litigation, destabilizing governance, and, in extreme cases, threatening the survival of the company itself.
To illustrate, a well-known and widely publicized example in Brazil is the case of the Safra family, who faced an intense succession dispute following the death of banker Joseph Safra. In July 2024, the parties finally reached an agreement, ending a global controversy over his will, estimated at around USD 25 billion: his son Alberto agreed to divest from the J. Safra Group and continue with his ventures through his own company, ASA, amicably and out of court, with the appropriate reorganization of Banco Safra’s corporate control.
Therefore, more than a formal act, a business will must be understood as a pillar of governance and legacy protection. When combined with other tools, such as family protocols, shareholders’ agreements, and appropriate corporate structures, it transforms the moment of succession into an orderly transition, preserving assets, organizational culture, and competitiveness.
Thus, for family businesses seeking to overcome the challenge of generational succession and remain solid in the long term, the conscious and strategic use of a will is not merely advisable—it is essential.
By Giovanna Spatti Rossagnesi*
Master’s student in Business Law at FACAMP, specialist in Contract Law at Faculdade CERS, postgraduate in Corporate Law and Compliance at Escola Paulista de Direito, and lawyer at Granito Boneli Advogados.