Governance of single family offices varies widely, per Morgan Stanley survey
Single-family-office governance varies widely, according to a survey of 75 offices in a new report from Morgan Stanley.
Nearly 1 in 5 of the family offices had no formal governance structure at all. Of the other 81%, a slim majority have an investment committee. Beyond that, about a third of families have one or more of a board of directors, a family council and a family assembly; 16% have an advisory board.
About 40% use just one of those types of structures, and about half use two or three of them; only 13% use four or more.
Those governance choices showed some substantial differences when compared with the amount of assets under management in the family office, but no clear tendency that more money means more governance.
On the choice of documentation used to govern their family offices, single-family offices were divided among three large groups, with no clear winner. The largest chunk — 40% — have a family mission statement, 36% went with a strategic plan, and 24% chose to have a family charter or constitution.
When it comes to the types of investments single-family offices choose, nearly all are in private equity, with the vast majority also making allocations to public equity, real estate and fixed income. Substantial percentages are also invested in venture capital and hedge funds.