In most Austrian private foundations, substantial parts of family assets are held. However, the family itself is excluded from the administration of the foundation assets. In our view, it is therefore all the more important that the family has appropriate rights of influence and control over the management of the foundation assets. The corresponding rights of influence and control are usually granted to an advisory board, which is mainly composed of family members as desired.
In recent years, the courts have successively restricted the possibilities of influence and control of such a family advisory board on the management of the foundation. Therefore, it was necessary to develop a system that guarantees the necessary control of the founder family over the management of the private foundation despite this restrictive jurisdiction.
The Supreme Court has now recently had to deal with the system that we have long recommended and have already frequently implemented, which guarantees the family advisory board the necessary rights of influence and control over the activities of the foundation’s executive board. The Supreme Court came to the conclusion that this system is unobjectionable and therefore effective.
We therefore cordially invite you to examine together whether your family’s so important rights of influence and control in your private foundation are also in conformity with the law and sufficiently developed. Creative solutions sometimes need a fresh perspective.
