Ocorian, a provider of services to high net worth individuals and family offices, financial institutions, asset managers and corporates, has just released a new study based on interviews with over 300 family offices.

Family offices are stepping up their focus on governance, with 86 per cent of respondents citing having the right governance in place as their biggest challenge, as regulatory demands and multi-jurisdictional complexities grow, new global research from Ocorian reveals.

In July 2024, Ocorian commissioned independent research company PureProfile to interview more than 300 family office professionals managing a combined $155 billion in assets, including 201 working for multi-family offices. The global study interviewed family offices in Bahrain, Bermuda, Canada, France, Hong Kong, Nigeria, Saudi Arabia, Singapore, South Africa, the United Arab Emirates, the UK, the US, Cayman Islands, Egypt, Ethiopia, Germany, Ireland, Italy, Kenya, Spain, Sweden, Switzerland, Tunisia, Jersey and Guernsey

“As family offices become more professionalised, the emphasis on governance has intensified, with a clear majority identifying it as a key concern,” the firm said. This focus is reflective of the broader industry trend towards enhanced scrutiny and regulatory oversight, as family offices – many of which operate across different jurisdictions – face diverse and increasingly stringent compliance obligations.

“Governance has become a principal focus for family offices, and it is something that consistently comes up in conversations with my clients. They are increasingly reassured when a service provider, like Ocorian, connects them with leading regulatory and compliance professionals to guide them through this evolving landscape,” Michael Harman, commercial director – private client at Ocorian, said.  

In response to the growing complexity of the regulatory environment, family offices are seeking independent guidance to ensure compliance across multiple jurisdictions. Bovill Newgate, a regulatory consultancy and an Ocorian company, helps to provide such support.

“In a study we commissioned earlier this year in partnership with Ocorian, two thirds (65 per cent) of alternative fund managers admit being subject to governance-related fines or sanctions during the last two years and nine in 10 (90 per cent) see their organisation’s focus on governance increasing over the next 24 months,” Cilla Torode, head of Bovill Newgate Guernsey, said.

“With regulatory frameworks continuing to evolve, particularly for family offices operating across different jurisdictions, the need for robust governance practices has never been more pressing,” Torode added. “At Bovill Newgate, we recommend a three lines of defence approach to help family office professionals protect their businesses. This involves creating strong frontline processes, continuous monitoring, and ensuring rigorous independent audits of governance frameworks to mitigate risks effectively,” Torode continued.

Ocorian’s three lines of defence approach to tackle risk and compliance challenges:

Line one: create clear and robust frontline processes and procedures, supplementing this with both online and face to face training programmes for staff.

Line two: build and empower a comprehensive compliance oversight function which monitors and assesses the processes and procedures, as well as advising and supporting staff and senior managers to comply with the firm's obligations.

Line three: seek review and challenge of the firms AML framework via annual independent audits.