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Reputation Management For Family Offices: New Life In The Spotlight
Jennifer Prosek
1 April 2019
Guarding a family’s reputation – as news stories continually remind us - is important, and family offices are part of how this can be achieved. Protecting a family’s best interests is far more than about hard money. This publication is pleased to share insights on reputation management from Jennifer Prosek, founder and chief executive of survey that they plan to manage their money with purpose. Currently, more than a third of family offices already practice some form of impact investing, 39 per cent of family offices expect that they will increase their allocations to environmental, social and governance investing under new leadership. Sara Hamilton, founder of Family Office Exchange - representing more than 380 ultra-wealthy families across 27 countries - says they often work with families to help them recognize their enterprise value and determine a family brand narrative. Telling the positive stories behind impactful investments in operating businesses and the community will help to mitigate criticism and negative attention by political populists who are skeptical of concentrated wealth. It will also be crucial towards successfully implementing changes in corporate behavior through shareholder and public activism. Winning the battle for talent Because of their growing size, family offices now have access to talent that would have previously only considered working at banks, hedge funds or large asset managers. Ben Ingram of Berwick Partners, a recruitment firm, told The Economist that he has seen “enormous growth” in the number of highly skilled finance professionals willing to consider working for family offices. The typical advantages include better work-life balance and positions of greater responsibility. Multi-family office potential With just a handful of clients, multi-family offices can quickly build up enough assets to attract both regulatory and social scrutiny. They also tend to be global, so they will have marketing and reporting needs in multiple jurisdictions. Every family office is an investment platform that can be expanded by taking outside money. Conversions from single to multi-family office structures will likely become more common as taking in outside money is a logical way for a family office to leverage economies of scale inherent to asset management while generating fees that will nourish the underlying fortune for years to come. This has long been a quiet corner of the financials universe, but nothing in this world escapes attention forever. It’s time for family offices to tell their stories, or they risk having those stories told for them.
Family offices need to compete for the best investment talent and that means creating a company culture and brand. The largest family offices have hundreds of employees and engage in an array of activities.
Multi-family offices are also growing in assets and number. They share similar needs of a single-family office, except that they also need to market to wealthy families to expand their asset bases.