The Family Office

Many wealthy individuals reach a stage when they might benefit from the services of a family office to support them in their goals. Their affairs reach a degree of complexity where there is a clear need for dedicated staff to serve both their long term and strategic requirements as well as, to handle day to day administrative matters as they arise. Such services might be built solely for the family or sourced from external, expert providers.

Family Focused Approach

A ‘family focused’ approach recognises that the long-term preservation of wealth, typically across generations, is far more dependent on the family itself than on professional advisers and that engaging family members in the purpose and process of stewardship is a crucial ingredient of the service.

Part of the justification for a family office is to integrate a plan for the management and administration of the family’s affairs with a plan for

family succession, which might include collective agreement on the purpose of the wealth and key objectives. It also requires positive family governance, essentially the framework for decision making, leadership and family communication. This is designed to unite the family in common purpose and minimise the potential for dispute. In every family there will be some members who are actively interested in and motivated by the opportunity to manage and create wealth and others for whom wealth is simply a means of funding their lifestyle, thus being more inclined to rely on professional advisers. These differing perspectives need to be reconciled, and can have a major bearing on decisions concerning family assets.

The family office role thus demands a deep knowledge and understanding of the family, their aspirations, as well as the assets they own and expertise across all aspects of their affairs, sufficient to contribute to high level decisions. A cornerstone benefit of a ‘multi-family’ office is the contribution of deep practical experience drawn from a combination of families going through similar challenges.

Additional reasons for family office services range from long term planning for a family business through to the preparation of next generation family members. Such services may, if required, manage the administrative aspects of the family’s life to free up more quality time or to focus on core interests.

Keeping On Top Of Complex Arrangements

Many entrepreneurs have numerous investments and ventures, held through different entities, with complex tax issues and sensitive family considerations. There often comes a point when it is impossible for one person to master all the necessary background and information, and the need arises for more disciplined and well-structured processes and record keeping, supported by a group thoroughly aware all of the issues.

That group must be able to identify problems, offer opinions and bring a degree of expertise and experience. In some cases, such an individual can become indispensable, allowing the entrepreneur to focus on his or her core activity, without having to worry continually about the details of their financial and family arrangements. Crucially, such an individual also gives peace of mind to those who are concerned by the prospect of an unexpected event leaving their spouse or children with a complex financial situation, of which they may have very limited understanding.

The Value Lies In The Combination

Overlaying this, some aspects of the arrangements may demand significant professional input and the family office procures such input either from within its own professional staff or a trusted partner.

It is this combination of managing family arrangements, providing expert administrative support, and bringing high levels of technical expertise and experience, that makes our family office services highly valuable and very different from a typical wealth manager.

Functions Of A Family Office 

The functions of a family office are, by definition, many and varied, to meet the needs and preferences of the particular family:

Family Governance
Asset Management
The Family Business
Property, Art & Leisure Assets
Philanthropy & Impact Investing
Managing Transactions
Tax & Financial Planning
Risk Management
Family Events & Disputes
Strategic Reviews & Succession Planning

Advantages Of A Multi-Family Office

One of the main advantages of a multi family office is that it comes with economies of scale, and hence can offer a more sophisticated operating platform, much greater diversity of expertise and invaluable practical experience of other families, addressing similar issues.

The complexities of managing wealth in all its forms have increased dramatically over the last decade and require increasing input from specialist advisers.

Therefore a multi family office pooling extensive expertise can be a cost effective and thorough approach to providing the necessary range of advice to complex families with substantial private capital.

For potential clients, the practical experience of exposure to other families is among the most attractive features of a multi family office, in that they are usually keen to learn how other families have dealt with similar situations and what lessons have been learnt. When such introductions are made sensitively and appropriately, they can form the basis of deeply enriching relationships,

The operating platform is of particular importance for those with diverse assets and holding structures, as such consolidated reporting enhances efficiency and enables flexible reporting tailored to particular circumstances.

For international families with a wide variety of assets, held through multiple structures, there is a demonstrable need for the services of independent, global multi-family offices, which can genuinely partner with their clients and serve a broad range of their requirements. This means being able to add value across the totality of their affairs, but nearly always working in partnership with other professional advisers.

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