Should My Trustee Understand My Business?

When you are both the owner of a thriving company and the architect of your estate plan, one question rises to the top: How deeply must my trustee know my operations? The answer is nuanced, and overlooking it can spark the kind of conflict now unfolding around Jimmy Buffett’s $275 million estate. In that high-profile dispute, questions about who controls the business empire and who protects the family have collided in court. The lesson is clear: choose the right steward, or risk watching your legacy turn into a battleground.

Why Business Expertise Matters

A trustee is responsible for safeguarding trust assets, satisfying creditors, and distributing wealth according to your wishes. When those assets include an active enterprise (think: inventory, contracts, intellectual property, and payroll), the job shifts from passive oversight to hands-on management. A trustee who misreads a financial statement or allows tax filings to lapse can weaken cash flow and damage market value within months.

How Deep Is “Deep Enough”?

Obviously, your trustee is not you. They will not step in as the day-to-day CEO. Their real job is to protect the company’s value for your beneficiaries while keeping the doors open until a sale, buy-out, or transition can occur. That means they must be able to keep cash flowing, maintain goodwill, and make informed decisions, or at least know when to bring in help. Key competencies include:

• Financial Literacy. This is mandatory. A trustee must read profit-and-loss statements, track debt schedules, and meet tax and compliance deadlines. If the numbers go sideways, they need to spot it early and act.
• Operational Mastery Is Ideal. Understanding how inventory moves, who the key customers are, and which staff keep the phones ringing helps the trustee avoid costly interruptions. Even if they cannot fix an HVAC unit or code software, they must know which levers drive revenue.
• Curiosity and Delegation Save the Day. A smart trustee asks questions and hires experts. Leaning on a CFO, general manager, or outside consultant can plug knowledge gaps without slowing the business.
• Risk Management and Compliance Oversight. From renewing insurance policies to satisfying state licensing boards, the trustee must keep regulatory plates spinning so the company stays in good standing.
• Communication With Stakeholders. Employees, vendors, and beneficiaries all need clear, timely updates. A trustee who can explain the game plan maintains morale and preserves the company’s reputation.

By spelling out these expectations in your trust and succession documents, you make it clear that the trustee’s role is stewardship (and not necessarily leadership), where they must preserve the asset first, then execute the exit or hand-off strategy when the time is right.

Put It in Writing Before Trouble Starts

The Buffett litigation reminds us that good intentions mean little without clear instructions. Your trust should also spell out:

• The trustee’s authority over hiring, compensation, and major transactions
• Reporting requirements to beneficiaries and co-trustees
• Triggers for professional audits or outside appraisals
• Procedures for replacing a trustee who cannot meet performance standards

Review these provisions every few years. A start-up’s needs differ from those of a mature company, and a trustee who once fit the bill may not keep pace with growth.

Striking the Balance Between Business and Family

The bottom line is that running a company while caring for loved ones is a unique kind of tightrope walk. You want your enterprise to keep humming along, yet you also need to protect the people who depend on its success. That mix of boardroom pressures and family priorities can feel overwhelming, especially when you start drafting an estate plan.

However, you do not have to tackle it alone. By working with a team that understands both business operations and family dynamics, you can create clear instructions that keep paychecks flowing, uphold your company’s reputation, and give your beneficiaries the security they deserve.

If you are ready to simplify these decisions and put a thoughtful plan in place, we are here to guide you. Schedule a confidential consultation with a Broken Arrow trust lawyer who understands business today. Call 918-608-1836 or use our online scheduling tool and let’s safeguard your business and the people you love together.