Two Golden Rules
May is Domestic Violence Prevention Month. This presents an opportunity to start a conversation, a chance to review and revisit internal policies and procedures, as well as an opportunity to invest in DV Alert or Psychological first aid training for staff. It is also timely in light of the new requirements covered in the Fair Work Amendment (Paid Family and Domestic Violence Leave) Bill 2022, and the new Code of Practice – Managing the risk of psychosocial hazards at Work which commenced 1 April 2023.
Recently we presented at a Women in Agriculture event where the spotlight was firmly on the complexity of owning and managing an agribusiness. Women at the event openly discussed the many things required to remain viable, sustainable, competitive, and meet ever increasing compliance demands.
Participants also discussed the disturbing statistics on the financial security of rural women which only scratch the surface of a very complex and frequently overlooked issue. Rural women shared many reasons for the challenges in relation to the financial risks they face and building their and their family’s financial security.
What is financial security? It is a measure of a person’s ability to preserve their standard of living by making independent financial decisions without stress or anxiety. Wouldn’t we all want and deserve this? Why is farming any different?
To the same extent as men, women contribute to agriculture’s productivity through on and off farm work, domestic duties, and voluntary work. The challenge is that for farm businesswomen, factors such as a lack of inclusion in decision making and control over the money, an inability to earn or save personal income and a lack of recognition in farm business structures can make them disproportionately vulnerable to poverty in retirement or after significant events such as bereavement, divorce, or natural disaster. The other big one is family transition and succession.
Last year the Queensland Farmers’ Federation (QFF) released their ‘Walking the Wire’ resource to help guide rural women take the next steps in securing their financial future. The following jumped out as useful for all of us to consider.
Kylie Wilson, Partner Holding Redlich, and succession expert said her two Golden Rules that need to be addressed to ensure that the farm can transition in a way that does not risk anyone’s financial security were:
The older generation needs to be able to retire comfortably without relying on the farm as their only source of income; and
The next generation taking over the business needs to be satisfied that they are taking over a viable business, once the cost of golden rule number one has been determined.
Kylie said, “Without a doubt, one of the largest risks to family farm businesses is the failure to address succession planning during the lifetime of the generation that currently controls the business assets. The most important thing is to start early with succession and keep the communication lines open.”
Many women will agree, setting out the above rules is simple but achieving them can become complicated and fraught with difficulty, particularly where communication breaks down. Walking a tightrope or barbed wire fence indeed.
