Polarity Thinking: Critical Guidance for Family Trusts and Trustees - Part 4 of 5

Polarity Thinking: Critical Guidance for Family Trusts and Trustees - Part 4 of 5

A Few Other Regularly Appearing Polarities in the Trustscape
Article posted in Values-Based on 28 July 2015| comments
audience: National Publication, Daniel P Felix - The Professional Trustee | last updated: 28 July 2015
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Summary

Part 4 of Dan Felix's Polarity thinking series takes us to less common but important occurences of the subject at hand.

By Daniel P. Felix, JD – © all rights reserved 2015

PART 4: A FEW OTHER REGULARLY APPEARING POLARITIES IN THE TRUSTSCAPE

Polarity is an essential trait of all things. Tension, contrast, and contradiction characterize all of reality. … To ignore the paradox is to miss the truth. – Abraham Joshua Heschel

In addition to the polarity of the “trust creator AND the beneficiary”, there are other core as well as regularly appearing polarities, which range over the trustee’s various activities.

Interdependent pairs are necessarily involved in the trustee’s task of stewarding assets. Stewardship policy inherently engages the polarity of sowing AND reaping. This is true especially where the trustee has discretion over some or all of the investment and distribution decisions. Applying Polarity Thinking in creating stewardship policies can be particularly helpful. Such policy statements can serve as an organizing structure around the intentions and actions of the trust. In addition, stewardship policies can help appropriately manage beneficiary expectations.

Another set of polarities often exists around the trustee’s communications. In communicating, the trustee should tend to the competing interests of transparency AND discretion. Naked transparency, that is transparency which is not balanced by discretion, can be naïve and destructive. On the other hand, secrecy can foster distrust when not mindful of the natural need for stakeholders to know what is going on and so, can also be destructive. It is in the dynamic balancing of these two poles that the better course can be defined.

Polarities exist around the very work of the trustee for the trust stakeholders AND for himself. The duties of the trustee owes the stakeholders is highlighted in his legal obligations as a fiduciary, among others. Yet, the trustee is no slave. In fact, the administration of trusts may generate fees and support a profitable and fulfilling professional service. Consideration of this set of interdependent pairs may be core.

Another prominent set of interdependent pairs in the trustscape is “Structure” and “Culture”. To attempt to set up a system of governance or any rules over a family is doomed to failure without due consideration of the culture of the family. Similarly, the focus of a family’s culture -- without a healthy regard for appropriate structure -- is an invitation to self-indulgence.

There can be the polarity of “a particular beneficiary AND all the beneficiaries” when there is more than one beneficiary. So, to sketch an illustration: considering one beneficiary to the exclusion of the whole group, may lead to a lack of uniform treatment; whereas, the focus on the whole group without considering the unique needs of each beneficiary may result in the trust not empowering the individual as best it could. And so, mapping this interdependent pair could be helpful especially in the administration of so-called pot trusts, where distributions to multiple beneficiaries are to be made from a common fund.

Finally, a polarity of a different type has been called Intergenerational Oscillation, which refers to the known phenomenon of the pendulum swinging back and forth over the generations. So, for one example, a generation of entrepreneurs may be followed by a generations of creative-types and philanthropists. Mapping the generational difference may increase understanding and acceptance, and so result in smoother administration.

In Part 5 of this article I’ll offer some CLOSING THOUGHTS ON THE PRACTICE OF POLARITY THINKING IN THE TRUSTSCAPE including a return visit to the situation of Tom the Trustee, Betty the Beneficiary and Calvin the Trust Creator!

___

The author gratefully acknowledges the generous and gracious support and help of Barry Johnson, founder and principal of Polarity Partnerships, LLC, and his colleague, Susan Dupre.

See www.PolarityPartnerships.com. The author also gratefully acknowledges the editing help of collaborator, Neesa Sweet, Braided River Group, www.braidedrivergroup.com.

 

ADDITIONAL INSTALLMENTS:

First: A BRIEF INTRODUCTION TO POLARITY THINKING 

Second: THE CORE POLARITY IN THE TRUSTSCAPE: BALANCING THE TRUST CREATOR’S WISHES AND THE NEEDS OF THE BENEFICIARIES

Third: MAPPING THE CORE POLARITY IN THE TRUSTSCAPE

Fourth: A FEW OTHER REGULARLY APPEARING POLARITIES IN THE TRUSTSCAPE

Fifth: CLOSING THOUGHTS ON THE PRACTICE OF POLARITY THINKING IN THE TRUSTSCAPE

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