Governance within the family office
16 November 2011
In today’s world objectivity is important, yet trust is rare.
By using a family office clients can be confident that their affairs are managed within an environment that supports a culture of governance and risk management.
Often, governance processes within the family office come about from shared visions of the family. A family may decide that the office should prepare a family constitution document that is built from family culture and values. This can include guidelines on the following:
• how often the family should meet
• what is expected of family members
• at what age they should become involved in the business
It is important that this document allows for alteration in the future in order that younger generations can have an input into how the family office should develop.
Regular meetings are essential and provide a forum whereby the family and their advisers meet to discuss strategy and the performance of assets held by the family.
Governance structures such as a family constitution document and a written investment policy help to ensure that wealth is passed from generation to generation, co-operation remains and the wealth is not diluted through generation to generation division.