ELITE ADVISOR BEST PRACTICES

Betrayal: The Emotional Malady of Family Businesses - Part One

There’s no going back

By Tom Hubler

Key Takeaways:

  • No form of betrayal is easy to handle. It’s especially difficult when it comes between close relatives working in the same family business.
  • Disagreements over strategy, leadership, vendor arrangements, financial provisions, future business direction, and buy-sell decisions can cause irreparable harm to the business and the family.
  • Smart business families learn to anticipate the unthinkable by having ways to preempt situations in which betrayal and lifelong damage can occur.


There may be no more debilitating force than betrayal when it occurs in a family business. Poet William Blake (1757-1827) wrote, “It is easier to forgive an enemy than to forgive a friend.” That’s because every betrayal begins with trust. It is “a violence against confidence,” an inside job. In my experience, betrayal ranks as a top destroyer of otherwise successful business families.

By its technical definition, betrayal breaks or violates a presumed contract, trust, or expectation to produce moral and psychological conflict in a relationship between individuals, organizations or both. But this cool, reasoned description of betrayal misses its intensity. Of all possible tragedies in life (except the death of a loved one), betrayal can wound more painfully than things physical; pierce more deeply than other things emotional; devastate love, trust and loyalty beyond what would seem endurable. When betrayal occurs among family members engaged in a family business, the loss can be unimaginable. I have witnessed its crushing effects in my work with business families.

Jack fires his daughter, Meredith, over a betrayal

Jack was mentoring his 33-year-old daughter, Meredith, in the family business. Meredith had been working in the business for five years and had gained her father’s confidence.

A decade earlier, Jack had divorced his wife, Leslie (Meredith’s mother), and remarried. Leslie had become unhappy with the divorce settlement. She took Jack back to court.

During the settlement dispute, Meredith told her mother some private, sensitive financial information about Jack’s business. Jack was shocked and distraught by that betrayal. He fired Meredith. Their father-daughter relationship was shattered—they no longer speak to each other.

This is one example among many situations that I have heard about or been part of in which differences between family members—strategic disagreements, leadership disputes, vendor arrangements, financial provisions, future business direction, buy-sell decisions—have been stunned by betrayal that caused irreparable harm and ruined relationships. On the surface these differences may sound like typical business negotiations, but when family is involved and expectations are unspoken, hurt feelings cut more deeply. Misunderstandings are seen as betrayal. Emotional distress damages relationships and generates destructive consequences to both the family and the business.

Betrayal can be so damaging in a family business that trust and confidence are never restored. A betrayal may be forgiven but not forgotten and can continue to erode the relationship. There is no way to undo the desolation of betrayal, no calm compromise, no meeting of the minds. As playwright Arthur Miller (1915-2005) put it, “Betrayal is the only truth that sticks.”

Reconciliation seems impossible because it’s not “just business,” it’s personal. That’s why business families must learn to anticipate the unthinkable by having ways to preempt these situations and to learn how to heal hurts once they occur.

Prevent. And if you don’t prevent, heal. This approach unfolds in the example of the “Danz” family, a composite taken from actual events.

The Danz family implodes

For nearly a decade, the Danzs had been plagued by family business troubles. They had tried several times to resolve their differences, without success. Relationships continued to deteriorate. For the last four years, the father, Charles, and his oldest son, Stefan, had not spoken directly to each other, even though they worked side by side. Instead they passed all their communication through a younger brother, Michael, who also worked for the company.

Michael eventually became so frustrated by his uncomfortable role that he announced he would no longer be in the middle. He told Stefan and his father they had to work things out. I was asked to help them find a way to heal.

In conversations with the family, I learned that when Charles was ten years old his own father had died of a heart attack. I realized this was a way to redefine the wedge between Charles and his son Stefan, as both were issues of loss. Charles lost his father through death, and Stefan had lost his dad through business tensions and unrecognized pain. I suggested to the family that the unrecognized sense of loss for both Stefan and Charles was holding them back. The emotional pain that arose from betrayal kept them from sharing their distress let alone from forgiving each other. Once they grasped how this was the problem, I recommended a Family Forgiveness Ritual© that included their priest. They were eager to proceed.

As I widened the discussions to other family members who were participating, each of them also identified losses. Elaine, the mother; Patsy, Stefan’s wife; and Marc, the youngest son, all recognized this sense of loss as an issue. We were able to create positive intentions from this mutual understanding. The Danzs were a conservative, traditional Catholic family and moved forward within a handful of meetings.

But there was another issue that kept the family from healing. Siblings (there were five other children) vilified Stefan because of his ongoing tension with their dad. They shunned him at family gatherings and held him at a distance so that family get-togethers were emotionally punishing. Everyone was hurting. All felt betrayed and misunderstood. No one could see a way out.

Healing starts with forgiving

At the meeting, I presented the psychological aspects of forgiveness. The priest observed forgiveness from a religious perspective. A Benedictine monk, the priest drew from the church’s long tradition of forgiveness, bringing a positive perspective that encouraged the family.

Then it was time for family members to talk about what they wanted to be forgiven for. There was a long, long silence—so long that I wondered if this was the right thing to do.

Then Quinn, one of the middle sons, broke the silence. He had flown in from out of town to participate in the Family Forgiveness Ritual. He said to his father, “I want to ask for your forgiveness for taking so long to tell you I’m gay.” Quinn had shared this with his family, but now asked forgiveness for taking so long and not trusting his parents.

After another long silence, Charles said, “I want to ask your forgiveness for how I handled hearing that you were gay.” The curtain lifted. Elaine began to cry, and each member of the family in turn shared how they had contributed to the problem. Even daughters-in-law who had more recently become part of the family wanted to be part of the process. Charles and Stefan also forgave each other and worked to reconcile their differences.

The younger sons’ courageous admission that they did not trust their father led to an open discussion about forgiveness within the family. Charles apologized to Stefan for the unkind and judgmental things he had said about Stefan’s wife. Stefan forgave him. Stefan also forgave Charles for the mean-spirited and critical behavior he displayed at the company. As a result of the Forgiveness Ritual, Charles and Stefan reconciled with each other and resumed one of their previous father-son activities—meeting over a beer then attending the local high school’s Friday night football game.

During the last part of the Forgiveness Ritual, their priest conducted an absolution ritual. The family celebrated the Eucharist (a tradition of the biblical Last Supper involving bread and wine) at their home and followed with a potluck meal to which they all contributed.

Conclusion

As they cleaned up at the end of the day, they reminisced and shared stories. Stefan, who at the beginning of the ritual was isolated in a corner, was now the heart of the family sharing. And at Christmas, Quinn brought his partner home for the first time. It was, the family said, the “best Christmas ever.” In Part Two of this article, solutions to betrayal and the impact of forgiveness will be explored.


About the Author

Tom Hubler (tomh@thehublergroup.com) is president of Hubler for Business Families (hublerfamilybusiness.com) and an adjunct professor at the University of St. Thomas. He can be contacted at (612) 375-0640.