The Family Office - A Practical Guide to Strategically and Operationally Managing Family Wealth

Translator’s Preface

Preface

Contents

About the Authors

List of Figures

List of Tables

1: What is a Family Office?

1.1 Why a Family Office Makes Sense

1.2 Reasons for Founding a Family Office

1.3 Expectations of the Family Office

1.3.1 Professional Wealth Management

1.3.2 Promoting Family Unity

1.3.3 Other Benefits

Bibliography

2: How is a Family Office Structured?

2.1 The Development of the Family Office: From Part of a Firm to a Separate Entity

2.2 Structures and Models of Family Office

2.2.1 What a Family Office Can Offer: Tasks and Structures

2.2.2 Models for a Single Family Office

2.2.3 Models for a Multi Family Office

2.2.4 Potential Conflicts of Interest at a Commercial, Dependent Multi Family Office

Interview with Simon Foster

3: What are the Fundamental Success Factors for a Family Office?

3.1 Founding a Single Family Office: How Much Money is Needed?

3.1.1 Analysis of Costs and Required Services

3.1.2 Motivation and Commitment by Employees in Relation to Size of Wealth

3.1.3 Successful Scenarios for Single Family Offices Managing Smaller Fortunes

3.2 Success Factors for a Single Family Office

3.3 Founding a Closed Multi Family Office

3.3.1 Fundamental Decisions When Founding a Closed Multi Family Office

3.3.2 Responsibilities of the Managing Director of a Closed Multi Family Office

3.3.3 Issues When Developing towards a Commercial Multi Family Office

3.3.4 Specific Issues Related to Commercial Multi Family Offices

3.3.5 Reporting: An Important Task for the Multi Family Office

3.4 Success Factors for a Multi Family Office

Interview with Klaus Kuder

Bibliography

4: Structures for Managing Wealth

4.1 Family Wealth Management

4.1.1 Vision and Mission of the Family Office

4.1.2 Yield Requirements and Targets

4.1.3 A Survey of Asset Classes

4.1.4 Asset Class: Real Estate

4.1.5 Asset Class: Gold

4.1.6 Home Currency

4.1.7 Yield and Risk

4.1.8 Movement of the Investment Classes

4.1.9 Liquidity and Illiquidity of the Overall Portfolio

4.1.10 Asset Allocation

4.1.11 Diversified Portfolio

4.1.12 Active and Passive Fund Management

4.1.13 Selection of a Manager

4.2 Wealth Management Through Asset Accounting and Reporting

4.2.1 Performance Calculations

4.2.2 Controlling and Performance Review

4.2.3 Relative Benchmark

4.2.4 Absolute Benchmark

4.2.5 Investment Policies and Cost Controlling

4.2.6 Efficiency in Bookkeeping

Interview with Christoph Zapp

5: Reliable Handling of Legal and Tax Issues

5.1 Internal or External Advisors

5.2 Legal and Tax-Related Tasks

Interview with Nicholas Warr

Bibliography

6: Succession Planning

6.1 Forward-Looking Succession Planning

6.2 Handover of Leadership Responsibility

6.2.1 Defining the Fundamentals of Leadership Transition

6.2.2 Evaluating a Suitable Successor

6.2.3 Professional Management of Leadership Transition

6.3 Transferring of Wealth

6.3.1 Wealth Succession Following a Death

6.3.2 Accelerated Wealth Succession

6.4 Mediation: Helpful for Succession, and More

Interview with Christian-Titus Klaiber

Bibliography

7: Organizing the Family: Family Governance

7.1 Family Constitution and Family Charter for Family Office

7.2 Family Activities to Reinforce Cohesion

7.3 Involving Succeeding Generations: Continuing Education within the Family

7.4 Achieving Personal Goals Through Coaching

Interview with Larry Donckers

Bibliography

8: Effective Structuring of Philanthropic Engagement

Interview with Nour Abou Adal & Maissa Abou Adal

9: Concierge Services by the Family Office

10: Organizational Framework for the Family Office

10.1 Selection of a Suitable Jurisdiction

10.2 Selection of a Suitable Legal Form

10.3 Taxation Aspects

10.3.1 Impact of the Legal Form on Taxation

10.3.2 Fee-Based Work for the Family?

10.3.3 Value Added Tax

10.4 Regulatory Requirements

10.5 Structure Suitable for the Situation

Interview with James Fleming

11: Client Structure and Communication

11.1 Defining the Clientele

11.2 Information and Communication with the Clients

11.3 Consulting Discussions and Meetings

11.4 Making and Documenting Decisions

12: Committees, Guidelines and Professional Management Systems

12.1 Investment Council to Consult on Financial Issues

12.2 Risk Management Through the Family Office

12.2.1 Insurance Management

12.2.2 Internal and Organizational Risks for the Family Office

12.3 Establishment of Compliance Guidelines

12.4 Transparent Fees System for Financing

12.4.1 Allocation Based on Fixed Percentages

12.4.2 Allocation in Relation to Share of Assets Under Management

12.4.3 Cost Allocation Based on Time and Expenditures

12.4.4 Remuneration of Special Services for  Individual Clients

12.5 Who Owns the Family Office?

12.5.1 Dependent Department of the Company

12.5.2 Family Office as a Subsidiary

12.5.3 Association, Foundation, Trust

12.5.4 Role of the Family Members

12.6 Controlling and Consultation by the Advisory Council

Interview with Tom McCullough

Bibliography

13: Leadership Structures in the Family Office

13.1 Management Befitting the Requirements Profile of the Family Office

13.2 Management Structure of a Family Office

Interview with Leslie Voth

14: Strengths, Weaknesses, Opportunities, Threats: Avoiding Traps, Preparing for the Future

14.1 Cohesiveness and Trust Within the Family: Contradictory Responses to the Same Trap

14.2 Looking Forward

14.2.1 The Future of the Family Office

14.2.2 Digitization

14.2.3 ESG and Impact Investment

14.3 Final Thoughts

Glossary

Bibliography

Index