The family office should have a formal governance structure in place with a management board (consisting of family members and independent outside advisors) and it should report to the family on operational matters and financial performance.
Whilst no two family offices are the same as they have been established and evolved to serve the individual needs of their families, some commonly delivered services are included below.
Family Office Services
- asset allocation
- monitor investment performance
- manage risk
- develop financial planning
- oversee tax compliance
- co-ordinate group insurance
- accounting and taxation services
- implementation of intra-family transactions such as share transfers and estate plans
Some family offices go even further:
- non-financial consolidated reporting
- education & training services
- project management
- property management
family archive administration
- planning & execution of lifestyle concierge services
Source: Family Enterprises (Leach, P).
There are two main family office models:
The single family office (SFO) and the multifamily office (MFO).
The SFO is the traditional model, serving a single family. MFOs, which offer services to more than one family, often form by a family deciding to open up the services of their SFO to other families, spreading costs and risks across a wider asset base and ensuring the sustainability of the MFO in its own right.