Family constitution: the boundary agreement between the dinner table and the boardroom.
Setting down the intergenerational rules of the game in a family business: values, decision-making mechanisms, family-company boundaries and an enforceability architecture (shareholders' agreement + articles of association).
Why is a constitution needed?
In family businesses a crisis rarely starts on the balance sheet. It usually starts with unwritten expectations: who joins the business, who runs it, how profit is distributed, to whom shares may be sold, and when and how the founder steps back. A family constitution writes the answers down while the discussion is still a discussion and not yet a crisis. A good one does two things at once: it protects the family from the company, by leaving room for professional management, and the company from the family, by filtering out decisions made in the heat of the moment.
Content: five core headings
Values and purpose
what the company means to the family, and the long-term goal.
Employment rules
the criteria for family members joining the business (education, outside experience), and the principles governing performance and pay.
Ownership rules
share transfer, marriage and divorce scenarios (tied to matrimonial property agreements), dividend policy.
Governance
the family council, nomination to the board of directors, the independent-member principle.
Dispute resolution
an intra-family mediation step and deadlock solutions. The process matters as much as the text: a family owns its constitution only if it was written in structured meetings the family itself attended.
Enforceability architecture
Left on its own, a family constitution is a gentlemen's agreement. Legal force comes from integrating it on three layers: the provisions meant to bind move into the shareholders' agreement (share-transfer restrictions, voting agreements, exit mechanisms); those capable of registration go into the articles of association (pre-emption, transfer-restriction clauses, privileges); and the inheritance dimension is aligned with wills and inheritance agreements. We set this architecture out, within the full set of five instruments, in our generational-transfer guide.
From the family meeting to signature
The work runs in five steps. The family map: one-to-one conversations across the shareholders, the generations and the roles — everyone is heard on their own first. Workshop rounds: expectations are put on a shared table, and the contentious subjects are settled while they are still not a crisis. Drafting and negotiation: the document is written in the family’s own language, and the clauses are agreed one at a time. Building in enforceability: the shareholders’ agreement and the amendments to the articles of association are prepared, and the succession layer is tested against the reserved-share regime of the Turkish Civil Code (No. 4721). Keeping it alive: a family council calendar and an annual review rhythm are left behind. What you get: the constitution itself, the set of binding documents and the meeting structure.
Which families, and at what point?
Typical clients: family companies preparing for the handover to the second or third generation, cousin partnerships whose shareholder count keeps growing, and structures opening up to professional management. Where family branches hold equal stakes and the risk of deadlock is real, the binding arm of the constitution is reinforced with balance agreements between the partners, and the founder’s plan for stepping back is built on the same timetable as the inheritance and will planning. There is a single aim: that the document does not end up on a shelf, and the family stays at the table.
We are by your side for the Family Constitution
We run the process through family meetings, write the text in your family's own language, and build the enforceability layers with our corporate law and tax team. Where family members live in Germany, our Germany Desk prepares a document set that works under both legal systems. The constitution is the central document of our Generational Transfer focus — it lives alongside the rest of the succession plan.
Other Applications of This Service
Corporate Structuring — our other specialised solutions in this area.
Matter Connections
The focus areas, practice areas, desks and legislation connected with this sub-service.
Our Matters in This Service
The anonymised examples of our work that relate to this service.
Designing corporate governance across group companies
Single-source management and documentation of general assembly, board and compliance processes.
Review the matter →Advisory · Family BusinessEstablishing a family constitution and share-transfer structure
Making a family constitution binding through the articles of association, share-transfer restrictions and a shareholders' agreement.
Review the matter →Planning · InheritanceInheritance and will planning for assets in two countries
Consistent planning across two legal systems of the will, matrimonial property regime and company-share structure for assets in Türkiye and Germany.
Review the matter →The Team Delivering This Service
With our multilingual team of lawyers, well-versed in Turkish and German law, we are by your side.
The constitution itself is a statement of principles; legal force is established by carrying its provisions into the shareholders' agreement and the articles of association. We design every provision together with its “binding layer”.
Yes, the best time is when the founder is strong and the process is calm. Rules written in the middle of a crisis are read by the parties as an imposition and do not hold.
Share transfer restrictions, pre-emption rights, and matrimonial property agreements are structured together; the goal is to prevent shares from leaving the family in an uncontrolled way. This is the most sensitive negotiation area of the constitution.
The typical process takes 3-6 months (depending on the meeting rhythm). The constitution is a living document: the family council's annual review and an amendment procedure requiring a qualified majority are defined within the text.
Family Constitution — get the right legal support.
Let us identify the right solution together, drawing on our experience in Türkiye and the DACH region.