The Handover Charter: what parent and successor agree on

A Handover Charter is a short, written agreement between a founder and their successor about how leadership actually passes between them. It covers five things: which decisions move to the successor and when, which stay with the founder, how the two of them disagree, what the founder’s role becomes, and how the change is announced. It is not a legal document. It fits on one page, it is written together, and both sign it.

Most families have shareholder agreements, wills and governance documents. Very few have written down the practical rules of the handover, and that is where most of the friction comes from.

Why write it down at all

Founders and successors usually believe they agree. They have talked about the handover many times over dinner, in the car, after board meetings. Then a specific decision comes up, a key hire, a large contract, a change to a long-standing supplier, and it turns out each had a different picture of who decides.

Writing the agreement down does three things:

It forces precision. “You will run operations” becomes “you approve all hires below the executive team from 1 March”.
It surfaces disagreement early, in a calm conversation, rather than in front of the team.
It gives both people something to point to. When a decision is disputed later, the question becomes “what did we agree?” rather than “who is in charge?”.

The five sections

1. What changes, and when

List the decisions that move to the successor, with dates. Be concrete: hiring and firing at each level, spending limits, customer and supplier relationships, the agenda of the senior team meeting, who chairs which meeting. A staged handover with three or four clear steps works better than a single vague “transition period”.

2. What stays with the founder, and for how long

Equally important, and often left out. If the founder keeps final say on capital investments or on the bank relationship for another year, say so. A successor can work comfortably within clear limits. What undermines them is limits that appear without warning.

3. How you disagree

Disagreement between generations is healthy. Disagreement in front of the team is costly. A simple rule covers most of it: disagree in private, decide together, present as one. Agree what happens if you cannot agree, for example a time limit, a trusted third voice, or a rule that the person who owns that decision under section 1 has the final word.

4. The founder’s new role

“Stepping back” means different things to different founders. Write down what the founder will do: chairing the board, mentoring, specific relationships, a particular project. Write down what they will not do: attend the weekly management meeting, give instructions directly to the successor’s team, answer questions the team should take to the successor. Founders who know what they are moving towards step back far more gracefully than those who are only told what they are leaving.

5. The announcement

Who tells the company, the board, the bank, key customers and partners, in what order, and who speaks first. The order matters, and so does the founder standing visibly beside the successor when it happens.

How to write it

The charter works best when it is written in the room, in one session, rather than drafted by one person and sent to the other for comments. A few principles help:

The successor speaks first. It sets the tone that this is a conversation between two leaders, not a briefing from parent to child.
Work section by section, and write each agreement in plain sentences before moving on.
Keep it to one page. If it runs longer, it has become a policy document, and nobody will refer back to it.
Sign it, both of you. The signature is symbolic, and the symbolism is the point.
Agree a date to review it, usually after six or twelve months.

There is a free printable template with the five sections and space to sign.

A neutral facilitator helps, particularly on section 3. It is hard to negotiate how you will disagree while you are disagreeing.

What the charter is not

It does not replace the legal succession plan, the shareholder agreement or the governance structure. It sits between those documents and daily reality. Lawyers decide who owns the company. The charter decides who decides on Monday morning.

In short

A Handover Charter is a one-page written agreement between founder and successor about how leadership passes.
It covers what changes and when, what stays with the founder, how you disagree, the founder’s new role, and the announcement.
Write it together, in one session, with the successor speaking first. Sign it and set a date to review it.
It complements the legal succession plan rather than replacing it.

The Second Chair™ program ends with a facilitated handover session in which the family writes and signs its Handover Charter.