Corporate Trustees

Typically, people appoint close friends, relatives, or personal associates as individual trustees. Acting as a trustee carries many fiduciary and administrative obligations. It may not be fair to a relative or friend to burden them with such responsibilities, especially if they have other demands on their time, such as work and family. The individual trustee may not be suitably qualified to act, even though they may have the best intentions and a desire to do the right thing.

This is where you should consider appointing a professional corporate trustee. A corporate trustee can serve alone or as a co-trustee with your friend or relative and act as a sounding board that provides advice and helps prevents regulatory breaches due to oversight or a lack of awareness by a non-professional.

Benefits of Corporate Trustees

Using a professional as a co-trustee gives you the best of both worlds. You still have your trusted friend or relative to look after your best interests and a qualified professional to ensure the trust is managed to its fullest capabilities and operates within the trust document's terms.

A professional also brings impartiality into trust decisions, whereas an individual or family member may be influenced by personal relationships, especially if the trustee and beneficiary are family members.

In some cases, a trustee is also a beneficiary, which can create additional conflicts of interest. A corporate trustee offers unbiased and impartial advice that adheres to the terms of the trust and the decisions made when the document was written.

Due to the wide variance of legislation and tax implications in different jurisdictions, our corporate trustee services are offered via external partners. We have an extensive network of qualified and trusted professionals that we can approach for advice or refer you to.

The stability of a corporate trustee

The life of a trust can extend over many generations, far outlasting any one individual or trustee. People also become sick or unable to continue due to a multitude of reasons that would necessitate a replacement being appointed. This change in itself can cause conflict with beneficiaries who may feel that one person or another may have biases, or they may simply not like them. It also interrupts the smooth running of the trust.

Appointing a corporate trustee negates this situation and provides continuity of action and intent.

The duties of a trustee begin with the death of the grantor, and if they are close friends or even family, the trustee will be taking on the burden of responsibility at an emotionally sensitive time and can add to what is already a stressful situation.

Family unity

Appointing a corporate trustee can help prevent family conflicts and maintain unity. Managing a trust takes balancing the demands and needs of the current generation with those of future generations. Any large disbursement made to current beneficiaries will impact what is left to generate income or provide lump-sum payments to beneficiaries in the future.

The impartiality and situational distance corporate trustees bring to bear will help lessen conflict and the emotions that often arise when money decisions are involved, especially if one party is believed, correctly or not, to benefit at the expense of others.

We frequently hear from clients who choose corporate trustees because they want to ensure family unity and make certain their children are adequately cared for after they are gone.

Choosing a suitable trustee is essential

Acting as a trustee is a role that takes a lot of time and requires expert levels of knowledge in many areas. In addition to solid judgment, discretion, and access to resources, a good trustee needs to have specialized knowledge and understanding of areas such as:

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