This is the second part of a feature examining the details of legacy management facing successful living artists, an issue of interest to those wealthy individuals buying and investing in their works.

Legacy management is not an abstract concept and planning an artistic afterlife is a serious business concern for living artists. In today’s global art market, the significance of securing an artist’s estate while he or she is still living seems obvious and yet very few living artists engage in such advanced planning. 

In the following article, which is published in two parts (see the first part here), authors Randall Willette, Nicolas de Oliveira and Miriam La Rosa explain the terrain. Willette is founder and managing director of Fine Art Wealth Management and a regular commenter on issues of art and wealth management; de Oliveira is director of research and curatorial projects, Montabonel & Partners; La Rosa is senior researcher, artists estates, with Montabonel & Partners. (More detail on these organisations is below.) 

The editors of this news service are pleased to share these insights with readers and invite responses. They can contact tom.burroughes@wealthbriefing.com.

Assembling a team of art and financial experts
For an artist to plan their artistic legacy the development of a strategy is the first step before appointing legal and financial advisors. The best procedure for any artist is to make arrangements with a trusted professional art advisor to represent their estate and to develop an agreed strategy to ensure the visibility and financial viability of the legacy.

If they have had a successful career, consulting an attorney in advance who is familiar with handling artist estates is a good idea, as well as discussing the potential tax implications of the estate with an accountant. The decision on whether to have family members sit in on negotiations or to simply present them with the final decisions and agreements is up to the artist.

Estate planning involves much more than drafting a will and good estate planning for artists requires a variety of skills. The process for an artist may include: obtaining professional legal advice, choosing an executor, selecting a tax advisor, and articulating plans for the disposition of the art. All this can help ensure the continued life of the artist’s work and ideas.

Ideally, the legal professional who draws up an artist’s will and helps plan their estate is someone they trust, who is familiar with their work, who is knowledgeable about the art world as well as the law of trusts and estates. This particular combination of skills and experience may not be easy to find. The artist must decide which qualities are most important for their personal situation. An art lawyer by definition is engaged in the practice of overlapping legal disciplines— copyright, trusts and estates, commercial transactions.

Therefore, the approach and recommendations of an art lawyer may be different from those of a trusts and estates lawyer.

Unless an artist’s immediate family members are capable of handling business affairs and can represent and show the work, putting them in control of the artist’s estate can potentially do more harm than good. In fact, the more successful an artist the greater the chances that problems can arise as a result of mismanagement, mistrust, infighting, disagreements and overall inabilities to work with the art community.

Family members who lack appropriate knowledge of the artist’s career and an understanding of how the art business works are often completely unprepared to organise, present and promote the art effectively. And this is even more the case if the artist does not adequately prepare and educate them in advance about their responsibilities in this regard.

Branding, marketing, and promotion of the artist during her/his lifetime
Strategic positioning during an artist’s lifetime is an essential feature of a successful legacy. Handling networking with the art market, academia, and both public and private institutions is a central and ongoing characteristic of strategic development. Thus, a vital aspect for a successful expansion of the legacy is career planning with a view to positioning the artist’s work in key exhibitions and museum collections, which the estate will counsel on, based on its extensive network of contacts. These activities are deemed complementary to those of the artist’s gallery representatives, since they do not interfere with sales and rather intend to increase the visibility and significance of the work from a curatorial perspective. The estate therefore undertakes agreed liaison or represents the artist’s interests, when required, and also advises on representation should the artist’s wishes alter. In particular, the development of a marketing and exhibition strategy is imperative to raise the profile of the artist internationally. With this in mind, the curatorial remit of the estate comprises the exhibition of the collection in museums or other relevant art organisations, the procurement of publishing opportunities, enhancing gallery representations, as well as the sourcing of public commissions, sponsors and production funding for specific works.

A major goal of the estate is to become a reliable and authoritative source of knowledge for those wanting to research the artist’s practice both during his/her professional path and after life. In order to stimulate scholarly research, the estate can initiate a dialogue with universities to encourage graduate and postgraduate research projects focused on the work of the artist. This will favour the development of new interpretations on the artist’s oeuvre, whilst furthering the artistic legacy at an international level.

In addition, it can be the responsibility of the estate to evaluate, and tactically determine, whether and when to transfer holdings to museums, with the aim of augmenting the work’s reputation and value. The estate will therefore discuss possible options with the artist and/or family in due course, in order to opt for the most suitable and effective model of development; whether the artist will decide to maximise finances over a certain period of time, intending to cease operations at some point ("sunset model"), or to exist in perpetuity ("eternity model"), the benefits of strategic planning will undoubtedly foster the protection and maintenance of the legacy.

Documentation and publication of the artist’s work
The archive is one of the main pillars of artistic legacy, as well as being a practical tool for preservation, research and communication. It contains records such as photographs, videos, certificates, personal notes, documentation of exhibitions, works and correspondence. If demanded by the artist, the estate can advise on the most efficient methodology for retrieval and categorisation of materials – both physical and digital – as well as bodies of works. In particular, it is important that the key works are accompanied by appropriate taxonomies and descriptions, to allow for their correct assembly and interpretation by curators, collectors and researchers.

Given the complex nature of an artist’s oeuvre, regular publications are essential to promote and cement the significance of the work. These can take the form of user's manuals (UM) for key sets of works, monographs, exhibition catalogues and the catalogue raisonné (CR), which perform diverse roles and fulfil distinct purposes. 

The UM is a specific kind of publication whose aim is to gather comprehensive information on a discrete body of works, functioning in the manner of a guidebook, which contextualises the pieces in a given time frame. Whilst exhibition catalogues are related to particular shows, the monograph is a specialist type of writing on a single subject or aspect of the work. Hence, the CR is one the estate’s major tasks since it presents a complete and extensive overview of the artist’s oeuvre. It is the encyclopaedic index of the work, incorporating reproductions of and information about each single piece produced. The CR includes the full history of exhibitions and provenance, providing references to all existing publications, spanning exhibition reviews, articles and scholarly books. Each of the aforementioned publications reflects precise facets of the work, thus requiring to be released at exact times during the artist’s career in order to ensure a successful communication and an accurate establishment of the legacy.

Governance of the artist’s estate after the artist is gone
Governance is a term sometimes used to describe the management of a family’s financial assets, though it is rarely applied to an artist’s estate. Unfortunately, with the exception of a small minority of artists, most either never address governance when it comes to legacy management or wait until they are in the midst of a crisis before they finally get serious about creating and implementing a sound governance plan for preserving and protecting their art.

One key to making sure estate planning does not damage family harmony is to work toward open communication and look for creative ways to include family members in the decision-making process. A sound governance system for an artist estate must comprise both structure and discipline. The concept of governance for an artist’s estate has to be rooted in the notion that there’s something worth governing, perpetuating and developing. Because each artist’s needs are different, there is no real standard or template to follow. To be most effective, however, whatever system that is ultimately developed should facilitate three essential functions including: agreeing shared values for the estate; creating a framework for decision-making; and setting expectations.

In order to agree shared values for the estate the process of creating governance-related documents such as a mission statement can be truly valuable. If the artist’s family and their advisors can come together and engage in the collaborative process necessary to produce such a document, there is a good chance it will emerge with a set of principles that reflect what is important to the family, what kind of legacy it would like to achieve for the artist, and how to accomplish it. Revisiting these principles on a regular basis and holding the family to them at all times can help family members stay connected to each other and to their collective goals. While agreeing shared values is a necessary step in establishing a robust governance system, it does not create a framework within which a family can actually make decisions. This requires the formation of a structure that is typically the chief decision-making body for managing the estate and is bolstered by a well thought-out set of bylaws.

Creating a family charter which includes a well thought out succession plan can play an important role and provide a business-minded approach. While the family charter has no legal standing with regard to the issues covered, it does have a bearing on the legal documents for tax and estate planning that supports the artist’s intentions and goodwill as set out in the charter. 

The function of governance is to provide long-term guiding principles for the management of the artist’s estate. The policy should be written in broad enough terms to last for several years and should include: collection development, documentation, access, care and conservation for the artist’s entire body of work. To achieve maximum benefit, while also ensuring long-term care of the art, these four areas of policy should be developed in close collaboration with a curatorial team and in line with the overall family mission statement.

Conclusion
As living artists actively make decisions and choices that shape their legacy they must continually assess how best to care for and preserve the results of their efforts for future generations. Eventually, they are faced with what to do with their art after their death.

It is clear that family members and other beneficiaries have a crucial function in an artist’s estate, as potential inheritors and guardians of the artist’s reputation and family name; however, an artist’s standing is primarily ensured by the maintenance and enhancement of professional relationships specific to the world of art. It follows that the management and artistic direction of an estate is best ensured by an independent board of trustees comprising trusted art professionals - such as appointed art advisors, museum directors, and representing commercial gallerists - supported by legal and financial advisors. Good examples of estate management are often in place because the harmonious collaboration between key family members and an active group of respected art professionals.

Once an artist’s body of work passes a certain threshold, a wide range of financial planning considerations come into play. Careful planning can yield significant benefits in the future including financial security for the artist’s family, an opportunity to minimise potential tax liability, and the chance for the artist to leave a lasting legacy through proper preservation.