Each business family has its own culture, strengths, idiosyncrasies, points of contention and shared history. That’s why each family must do its own work to develop policies and processes — a structure built on the foundation of someone else’s family values probably won’t work for your family.

Even so, there are certain essential principles that generally apply to multigenerational business families who aspire to be conscientious stewards of their entrepreneurial legacy.

If you’re just beginning to investigate how to manage issues at the nexus of family and business, you may have encountered some terminology that’s unfamiliar to you. We provide some definitions and explanations here.

This glossary is adapted from a longer version that is distributed to attendees at Family Business Magazine’s Transitions conferences. The version presented here also includes some additional definitions.

Forty-one years ago, Renato Tagiuri and I were looking for a framework to categorize the issues, interests and concerns voiced by Tagiuri’s executive students, most of whom led family companies. It was 1978, and I was a first-year doctoral student. Tagiuri was a faculty member in a Harvard Business School executive program and had invited me to be his research assistant.

Until a little more than a century ago, the term “family business” was redundant, because every family was also an economic unit. Children were taught their parents’ trade and were expected to make it their career. The family business would often last for generations, but the family would not expect it to grow.