The Next Generation Of CEOs

Many of the B.E. 100s must prepare now to enterthe next millennium with new leadership

If the shares of the corporation are not sold at “fair market value,” the IRS may require the offspring to pay a gift tax. For example, if the owner sold a share of stock to his son or daughter for $200, when it’s actually worth $1,000, the IRS can make the claim that a $800 taxable girl was made to the heir.
Whether an outright payment or a deferment, estate taxes can drain the company of cash that it needs for operations and expansion. Moreover, the family’s financial stability may be placed in jeopardy. To protect investments that Percy Sutton made over the past 50 years, he has placed the family assets in a living trust, which holds title to the assets. Even though the ownership of assets have been relinquished to the trust, the trustee retains complete control to buy, sell, transfer or borrow those assets. Upon the trustee’s death, there is nothing to probate since the assets were not in the name of the deceased. Moreover, the trust document identifies who will serve as the successor.

Byron Lewis, CEO of Uniworld Group, the $145 million advertising and communications empire (No. 6 on the 1996 BE INDUSTRIAL/SERVICE 100 list), says his company’s succession plan is a work in progress. The 65- year-old entrepreneur plans to retire soon, but intends to create a smooth leadership transition before doing so. (Lewis’ son, Byron Jr., produces American’s Black Forum among other programs.)

Explaining his strategy, the elder Lewis notes: “We want the leadership to be a blend of the elders as well as the young people who are at home with the new technology.”

In shaping Uniworld’s future, Lewis will continue to diversify and create new divisions of the 27-year-old company, as a hedge against an overreliance on the core advertising business–and as a way to tap new management talent. For instance, he recently launched Uniworld Direct Response, a firm that targets and markets products to micro-segments of the African American consumer population such as churches and upscale black consumers. He’s also tinkering with a plan to spin off each of his six divisions into separate companies. He would hand the reins of leadership to the top managers of each of the respective units.

“Succession is critical to perpetuating black business as we know it today,” Lewis reflects, “and, for black companies, there are not many consultants to help you make that transition. The key is to marry those people who have experience with those who have a vision for tomorrow,” says Lewis. “That’s what I plan to do at Uniworld with the help of my advisors. That way I can leave a company that can function and grow in the future.”

Seven Steps Toward Successful Succession Planning
Succession planning is a process, not an event. When it occurs correctly, there will be as little disruption in the day-to-day business activities as possible. The vast majority of parents and most of their offspring. want their businesses to continue in family hands. But participation in the family business must

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