When equal shares stop being fair

My professional insights · Lyudmil Karaulanov · 6 min read

Published: 1 August 2026 · Version 1.0

Fifty-fifty can be a very good beginning. Two people trust each other, take a shared risk and want each to know they have an equal voice. I see no reason to regard that intention with suspicion simply because disagreement may arise one day.

A good arrangement, however, also makes room for the two people you will be in ten years. One may still want expansion; the other may need more time for family. Contributions, health and attitudes to risk can change. A good initial arrangement accommodates life rather than requiring both people to remain unchanged.

Equality does not always mean balance

An equal share provides important protection: neither person can easily disregard the other. Yet the same protection can prevent a decision if the necessary agreement is absent. For me, therefore, the key question is which decisions genuinely need to be unanimous and what follows when unanimity is missing.

Consider a company in which one partner wants to invest the profit in a new production line while the other insists on distributing it. Both wishes may have reasonable grounds. If the arrangements provide no way out of the disagreement, however, the decision remains blocked. The general meeting is postponed once, then again. The company continues to exist on paper, pays salaries and issues invoices, but stops developing. The market does not wait for the two to find common ground.

Most conflicts do not begin with an open confrontation

Disagreement may begin with an entirely ordinary change. One person needs income now; another sees an investment opportunity. Someone takes on a new family responsibility while their partner continues working at the same pace. These reasons deserve to be heard before they become a dispute about loyalty:

• one wants to invest, while the other prefers to distribute the profit;
• one sees the future in expansion, while the other seeks lower risk and greater peace of mind;
• different family commitments, financial means and personal motivations emerge;
• one continues working late into the evening, while the other gradually withdraws from daily operations.

Each of these changes deserves a conversation about both people's specific needs and contributions. The initial agreement may have been appropriate but no longer reflect the relationship. Revisiting it allows the change to be acknowledged without denying the fairness of the original arrangement.

The articles of association cannot anticipate everything

In more complex structures, a separate agreement between the partners therefore proves useful. It does not replace the articles of association. Its purpose is to regulate in detail those relationships that are difficult to accommodate in the company's constitutional document and that no one wants to discuss at its formation:

• how strategic decisions are made;
• which matters require unanimity and which can be decided by a majority;
• how to resolve a deadlock when decisions are blocked;
• what happens if one partner wishes to leave;
• how the price of shares is determined;
• under what conditions shares can be sold to an outsider;
• how the consequences of death, permanent incapacity or inheritance are addressed;
• how the company itself is protected when its owners are in dispute.

Such an agreement is not an expression of distrust. It expresses good governance and respect for what the two have built.

The best time for this conversation

While relations are good, you can discuss future disagreement without every clause appearing to target a particular person. This is a valuable opportunity. A conversation about exit can be a conversation about respect: how to preserve what we have achieved if life one day asks different things of us.

If disagreement has already arisen, the conversation still makes sense. It will simply require greater attention to each party's interests and to how proposals are presented. Advance preparation saves some of that difficulty.

There is no universal model

A ready-made agreement from another company with only the names changed rarely works. The people, their roles, financing needs and someone's actual ability to buy out the other's share all matter. A family business, a technology venture and a company with an investment fund among its owners present different challenges.

The only universal rule is that the absence of mechanisms agreed in advance rarely remains without consequences. They simply arrive later, usually at the least convenient moment.

Where, in fact, is the point of instability?

What this concept means →

It lies in the expectation that equal shares will, by themselves, also secure a shared decision. They preserve an equal voice but do not say what follows if the two use that voice in different directions.

Not every future disagreement can be foreseen. A procedure can, however, be agreed for how the two will talk, continue ongoing work and, if necessary, part ways. The initial trust then receives support for the time when it will no longer be sufficient on its own.

This material is of a general analytical nature and does not constitute individual legal, tax, financial or investment advice.