BEST PRACTICES
A successful
family office requires more than just a good
plan. It requires effective management that is
flexible enough to adapt to changes in the
family's needs.
MISSION |
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A
mission statement in the family's
own voice that captures the
business goals, family goals, and
important family values that will
guide decision-making for current
and future family members. The
mission statement should also
include a clear set of priorities,
one of which should be an annual
measure of the performance of the
office with respect to its
execution of the mission
statement. (Note: This is
different than measuring
investment performance.) |
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GOVERNANCE |
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A
governance process that clearly
outlines ownership vs. management
responsibilities, defines the
boards and committees to be
created and how they will
function, details policy and
procedures for each major function
of the family office in writing,
and discusses how family members
are to be supported by and
possibly included in the
decision-making process. Clear
bylaws, shareholder agreements,
family meetings and succession
plans are important parts of any
governance process. |
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EDUCATION |
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Ongoing
education for rising generations
and activities promoting
understanding among and between
generations. Mission statements
and formal processes are important
but are no substitute for paying
attention to family dynamics.
Family office personnel and/or
external coaches facilitate
communications exercises and
intergenerational activities that
provide the foundation for the
collaborative spirit that binds
the family and supports having a
family office.
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A
detailed outline of the services
offered (by whom and for whom) and
an operating budget. The service
offerings are often a mix of
outsourced solutions and services
provided in-house.
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Policies
that define the roles and
responsibilities of each staff
person, along with compensation
and benefit considerations. |
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