A new approach that puts family at the center of the family office
As families grow in size, they often become more complex. To help families flourish across generations, family offices need to evolve to address this complexity without losing sight of the family. Beyond engaging in financial administration, family offices can help families facilitate more effective communication, advance their family governance practices and help them articulate their purpose and vision for the future. This is the family focused family office.
Families benefit from enhanced communication—about their business, investments and philanthropy, as well as about being a family. The family focused family office supports more effective communication by facilitating communication initiatives that emphasize transparency, whether in-person or virtual, one-on-one or large family meetings. Facilitating clear and open communication is necessary if a family is to remain connected over generations in meaningful ways that support ongoing success.
Family alignment is paramount. Family focused family offices can facilitate family enterprise governance, which can include the business board, investment committee, foundation board and other councils. Family offices can help calendar meetings, build agendas and distribute information, as well as surface issues that need to be addressed. In addition to facilitating family enterprise governance, they can own the process and functions.
Family members often need help understanding and knowing how best to manage the complexity of family wealth. Here the family focused family office can play a role in facilitating financial literacy initiatives across the family enterprise, which can include a business and large investment portfolio, often with hundreds of positions as well as dozens of managers across asset classes and geographies. Financial literacy includes helping the family to understand their enterprise and make informed decisions amidst the complexity. Financial literacy helps families navigate their complex enterprise and should lead to better outcomes, both for the assets and for family relationships.
All of these aspects comprise the family focused family office. The family office goes beyond financial administration to enhance family connection, communication and alignment. It facilitates governance, fosters financial literacy and provides the family with a more robust platform from which to advance their philanthropy and values.