Things to Learn from Mukesh Ambani’s Succession Plan

When it comes to estate planning and business succession in India, no example is more insightful than Mukesh Ambani’s succession plan. You must have already heard that the renowned billionaire Mukesh Ambani has written his Will and created a comprehensive succession plan for his empire. Yes, Ambani – the owner of Reliance Industries Limited (RIL) – has distributed his estate among his three successors – two sons and a daughter. But we’re here to discuss the past that led Mukesh Ambani to take this wise step! So, buckle up because we’ll be telling you an interesting story now.

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Almost 14 years ago

Mukesh and Anil Ambani, sons of the legendary Dhirubhai Ambani, lived under one roof with their mother. However, the two brothers were under a fraternal property dispute. The reason? Their father, Dhirubhai Ambani, passed away in 2002 without writing a Will or putting any succession planning in place for his family. Dhirubhai made such a decision, thinking his sons would live in peace and harmony. But apparently, things turned out to be the complete opposite of his plans, as the lack of a clear succession plan ensured some tension and ambiguity regarding control of the empire created by the family business.

The two brothers took turns in the court. In 2005, Mukesh acquired the deep-sea gas fields of the Bay of Bengal. However, this family settlement required him to supply rationally priced feedstock to Anil’s power plant for 17 years at a fixed rate. Although such a settlement could have ended the 8-hour electrical cut-offs in New Delhi, it would have hampered Mukesh’s Reliance Industries Ltd. This situation served to show how unresolved succession problems can vitiate not only family health, but efficiency considerations and business growth opportunities.

In 2010, however, things turned out favorably for Anil through a Supreme Court verdict. The gas was declared to be Indian sovereign property and not private. Two weeks later, the two brothers began living in harmony again. They decided to end the non-competing clauses that created barriers between them and their companies. Mukesh Ambani soon re-entered the telecom and energy sectors, eventually rising to his current standing as one of the top 10 richest business tycoons, with a net worth of more than $90 billion.

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The current scenario

All those family disputes taught Mukesh Ambani a valuable lesson about the importance of estate planning and writing a Will. He was determined not to let history repeat itself. Understanding the vital role of clarity of information regarding inheritance, he conferred priority on the formalizing of his wishes for the sake of the legacy and the transition to his successors without family quarrels. He did not want his children to go through the same fraternal, financial, and judicial disputes because of one mistake – not writing a Will and not having a proper succession plan in place.

That’s why billionaire Mukesh Ambani acted wisely by distributing his estate among his three children. He laid down a clear succession roadmap for the $220 billion conglomerate that had once been subjected to a bitter fraternal feud.

Mukesh Ambani’s succession plan sets clear-cut roles for each of his three kids. His older twins, Akash and Isha Ambani, will be leading RIL’s telecommunications and retail businesses, respectively, while his youngest son, Anant Ambani, will be groomed to handle the energy and sustainability business. This well-structured business succession plan reflects Ambani’s foresight and his commitment to maintaining family unity and corporate success.

Why Mukesh Ambani's succession plan should be a learning point for others

Mukesh Ambani's announcement shows why succession planning in family businesses is of utmost importance. Unlike his father, Dhirubhai Ambani, who did not set out a defined succession plan in writing, Mukesh has sought to put in place a succession plan in writing that leaves no room for misunderstandings or litigation. He also proved that early planning leads to better continuity of business and better financial security for the coming generation.

Here are some lessons that Indian families and entrepreneurs can learn from the Ambani succession plans:

• Make a Will well ahead to avoid disputes about inheritance.

• Clearly define the duties and roles of each successor, particularly in family businesses.

• Introduce professionals for management where necessary so that a means of balance, as well as an atmosphere of transparency, is achieved.

• Train the successors to shoulder the responsibilities of leadership.

What you can learn from Mukesh Ambani

The case of Mukesh Ambani shows that it is not just a question of the wealth handed on. It is about the harmony of a family and the continuity of a business. If you have a big company or a property (however modest), it is always good to have a Will or a succession plan. This provides a sense of peace to the owner and saves his heirs from possible disputes. 

Moreover, planning for the future shows a sense of financial foresight, but at the same time, a sense of emotional foresight. If it were simply a matter of money, it would not be important, but by it, the works of a life will go on until interrupted deliberately by those who would be your chosen successors.

Lesson Learnt

Having learnt a valuable lesson from history, Mukesh Ambani made the wisest decision by creating inheritance plans for his heirs well in advance. Family capitalism in India is not new and shall continue to evolve unless it fully transitions into a more corporate governance phase. Until then, the best solution to avoid fraternal and financial feuds is good succession planning—which also includes structured mentoring for leadership roles and timely execution of a Will.

Planning for the future never goes to waste. When done at the right time, you save yourself and your family from unnecessary emotional distress, lengthy legal procedures, and financial troubles.

So, what are your views on this?

Ready to change your mind about the Will you’re still yet to make? Get it done !! AasaanWill Zaroori Hain.