Corporate Advisory

The five financial challenges of a company director

How many directors take major financial decisions alone? Constellation Patrimoine works across five fronts where value is most often lost — or exposure left unmanaged.

1. Putting idle cash to work

Surplus cash sitting in a current account loses purchasing power every year through inflation — an invisible erosion that never appears as a line in the accounts. We segment company cash into three pockets: operating cash, safety reserve and long-term surplus. Only the third should be invested, across term deposits, money-market and bond funds, a capitalisation contract for corporate entities, or real estate funds.

2. Optimising the director's remuneration

Salary or dividends? Salary is deductible from the company's taxable profit and builds pension and disability entitlements, but carries substantial social contributions. Dividends are more lightly charged but create no social rights at all — no pension, no cover in the event of sick leave. The optimal answer is almost always a mix, and it has to be modelled rather than assumed. We also assess whether a holding company or a civil property company is warranted.

3. Protecting the business owner

This is the most common blind spot. A self-employed director contributes relatively little and is often left with pension entitlements far below their standard of living, and with weak cover in the event of prolonged sick leave, disability or death — exposing both the family and the business. We audit existing cover, quantify the real shortfall and build the complement.

4. Employee savings schemes

Paying a conventional bonus is expensive: the amount bears employer and employee contributions, then income tax. French employee savings schemes — profit-sharing, company savings plans and employer matching — deliver a materially higher net amount for the same cost to the company. Where the company has at least one employee besides the director, the director can generally benefit too.

5. Life after the business

Family transfer, sale or a merger and acquisition process: this is usually the largest asset in a director's wealth and the least anticipated. Favourable regimes can substantially reduce the taxable base on a family transfer, subject to holding and activity commitments. Where a sale is planned, the critical issue becomes the reinvestment of the sale proceeds, which must be structured before signing — most directors raise it once the deal is done, when the levers are no longer available.

The audit: where we start

Everything begins with a full audit: gathering information and understanding your needs precisely. We examine cash, corporate taxation, your remuneration, your social protection, employee savings and any succession plans. You then receive a written report of costed recommendations, presenting several scenarios rather than a single answer. We implement the chosen solutions alongside your existing advisers and provide structured follow-up with a quarterly review.

Working with international directors

This is where our set-up matters most. Constellation Patrimoine is based in Paris, and our international office, Mevlana Investments LLC, is based in Dubai. We also maintain a presence in Singapore and work with strategic partners in Luxembourg, Switzerland and the United States.

We regularly advise foreign directors of French companies, French companies with international shareholders, directors relocating abroad and Gulf-based entrepreneurs investing in Europe. Cross-border situations raise specific questions — tax residency, treaty allocation of taxing rights, currency exposure, choice of holding jurisdiction — which are analysed before any structuring decision. Advisory activity in France is carried out by Constellation Patrimoine, registered with ORIAS under no. 101280329.

Why company and personal wealth cannot be separated

This is what distinguishes our approach from that of an accountant. Every decision taken inside the company feeds directly into the director's personal position: how you are remunerated determines your pension entitlements; how surplus cash is deployed affects the company's valuation on the day of a sale; and the ownership structure drives the cost of any future transfer. We work on both balance sheets at once, in coordination with your accountant, lawyer and notaire.

Which companies we work with

Self-employed professionals, independent practices, small and mid-sized companies and holding structures. Size matters less than situation: idle surplus cash, tax simply absorbed rather than managed, a director with inadequate protection, a need to retain key employees, or a sale or transfer contemplated within a few years. The firm manages more than €10 million in assets and draws on 7 years of experience. The first consultation is free of charge.

Written by Mevlana Yildirim, founder of Constellation Patrimoine, Financial Investment Advisor (CIF), registered with ORIAS under no. 101280329. Offices at 11 Avenue de Friedland, 75008 Paris, and an international office in Dubai (Mevlana Investments LLC). First consultation free of charge. General information only — this does not constitute personalised advice.