Family Offices and their professionalisation

Date: 25 May 2023

Karen Jones

Citywealth hosted a day forum to discuss the topic. In many ways, one could say, what else is there to add when this topic has been chewed over by many and over several years?

Family offices and their professionalisation rose as a theme earlier in the year in the Citywealth editorial board meeting. In practice though what does it mean? Citywealth hosted a day forum to discuss the topic. In many ways one could say, what else is there to add when this topic has been chewed over by many and over several years? The surprise was that there was still much to discuss.

With keynote speaker: Lord Bilimoria CBE, the other participants were Joshua Rubenstein, Katten Muchin Rosenman (Chairman); David Kilshaw, Rothschild & Co (Panel host); Christoph Courth, Pictet Group; Arabella Murphy, IPOS Mediation (Panel host), Caroline Garnham, Garnham Family Office Services; Ellie McLeod, Action for Children; Zita Nikoletta Verbenyi, The Legacy Atelier; Ashley Hill, Irwin Mitchell; Russell Prior, HSBC Private Bank; Matthew Sperry, Katten Muchin Rosenman; Khaled Said, Capital Generation Partners; David Bowen, EY; Etienne D’Arenberg, Spring Equity Partners.

Succession it seems, should be part of every family plan, but for me two themes were missing from the whole day. Firstly, there was a lot of talk about handing down to the next gen and how to manage expectations even if the head of the family does not want to do this. However, there was none on the first generation and what they should do once the business is out of their life. One constant with entrepreneurs who sell is a feeling of loss. Their go-to everyday schedule is gone. It results in a loss of status, a drop in invitations and almost a feeling like retirement with a void that has not much to fill it or perhaps in another way a loss of purpose. For ground-breaking, wealth generators this would seem an insurmountable problem that would need to be addressed first.

One attendee also added that the first gen, don’t think along the lines of handing over and are still so engaged with their own leadership and accoutrements that succession is more of a fantasy for intermediaries than a reality. One of our speakers, pushed back and said, “we have a programme in which 1400 families have participated and understood, often in a very emotional way, what all the issues are and how to face reality that the first generation do need to make this plan because death is a reality”, not something to dodge thinking about. So, there is progress, but advisors need to look up as well as down.

The second point that seemed to have a lack of representation was engaging more with the next gen in all areas. Both in including children of all ages in the business, bringing them along to meetings with wealth advisors to see what the parents do so that it is not such a surprise when the succession conversation comes along. Also, with industry professionals to include their upcoming generations with more vigour. Perhaps inclusion in another form. So as with work/lifestyle programmes, understanding that active meeting participation from professional firms with their next gen, even at a high level is crucial to helping this topic move forward. Perhaps an industry pledge to include new members of the team, even administrators to help develop understanding and employee engagement.

When I was a child, my father worked at Blue Circle cement (Lafarge) and they held Christmas parties for the staff’s children with high value gifts for us all, it was something that left a legacy with me. It undoubtedly took effort and cost money but was a philosophy of the company that created value for the employees and their children. It was exciting and fun.

Citywealth has always been proud of its tomorrow club offering, which was set up in 2005 to help new recruits into the wealth industry, make their own contacts and friends in high value organisations. We offer speed networking and presentations to the members to gain work referral (at a smaller level) and networking skills. It costs approx. £200k to train and educate new staff each year. The tomorrow club makes sure you get value from this investment. Tomorrow Club – Citywealth

We also have the future leaders awards to celebrate industry professionals under 40. The object is to give new advisors mechanisms to support their own career progression and to build confidence in their skills so that you can include them in meetings with important clients. To move away from being asked ‘how old are you’ as though important affairs cannot be trusted with the younger generation. It is also an excellent way to generate employee engagement and loyalty. Our latest crop of future leaders has been announced here: Future Leaders – Shortlist – Citywealth

The shortlist is created by submissions sent to Citywealth and the in-person judges meeting of recommendations. There is also a period for online voting, but this is mainly for publicity and recognition purposes. The judges make up 90% of the final vote and the online voting 10%. Scores are aggregated. Shortlisted attendees can opt to buy a ticket to the event to receive their award (if winning) and to network or opt to buy the marketing licence after the event, if they cannot attend, and to receive the trophy by post (if there is a win).

See the judges here: Future Leaders – Judges – Citywealth

A full report on the forum is being prepared and will be available on a complimentary basis.

To apply for a copy email Karen Jones, Editor, Citywealth kjones@citywealthmag.com