Family Offices have existed for centuries, but in the form that wealthy rulers appointed trusted guardians (managers) to look after their wealth while they were dealing with affairs of state. The first examples of modern family offices were most probably those of the Rockefeller and Mellor families. These family offices set the tone and trend for what we know today as a single family office. It is a simple construct; a single family office is an organisation that looks after the affairs, wealth and business of a single family. The sole object of a family office is the welfare of the family it serves.
The purpose of any family office is to secure, grow and transfer the assets of a family to successive generations.
A modern trend is for every sector within the finance industry to create family offices. Investment advisors have set up family offices focusing almost exclusively on the management of wealth; fiduciary services companies have family offices administering the trusts, foundations and companies of their client families; banks provide family offices to attend to banking needs; even insurance, accounting and law firms are nowadays creating their own versions of family offices to provide their services. However, no family is so simplistic in its structure, needs and wealth that that an office focusing on only one aspect of service delivery is able to ensure the smooth running of the family’s affairs.
A family office in its true form is one that has the family and its needs at its centre. The structure, operations and functions of such a family office are designed to fit in with the family and ultimately assist the family to achieve its goal or vision.
Next: The single family office