Mitigating Family Reputation Risks for Family Offices
Protecting one’s privacy online and in person is a daunting task, especially for a high profile and high net worth family.
Without a family office taking specific measures to ensure a family’s privacy is protected, families are at a grave risk for Internet security breaches, data leaks, and personal safety violations. These incidents can have a devastating effect on a family’s reputation and disrupt their privacy.
In the age of technology, the privacy needs of wealthy families pose new challenges. However, with an effective risk management plan family offices can identify, manage, and mitigate potential dangers. Consider a step-by-step plan to start:
1. Conduct a privacy audit.
Family offices start off with a risk assessment by mapping every person, asset, and activity that is connected to the family. This will give a clear picture what private information will be at risk for going public, and how it could happen. This could also include auditing the children of the high profile individual, who are more likely to use social media and inadvertently expose sensitive or revealing information.
2. As a next step, family offices should evaluate the likelihood of a privacy breach.
The probability of an undesirable event will vary depending on the family’s activity, professional and personal relationships and status. Family offices should always consider the likelihood of a threat, the family’s previous track record, if there are any, and what society’s reaction would be in the event of an incident.
3. Once the audit and assessment are complete, the family office should start devising a plan of actions.
Many simple but effective privacy measures start from being more prudent online. This means securing old social media accounts, not using public Wi-Fi networks to make online purchases, and using different usernames and passwords for online accounts. Another aspect to consider is how these families act on special occasions, how they approach property transactions, commercial deals, and dealing with personal competitors.
Everyone has something they would like to remain private and no one should be made to feel self-conscious about it. While families might not have something to hide now, they might in the future. Personal privacy planning is the only way to protect against such problems. It is essential that high profile and high network families utilize their family office to the full extent to avoid a privacy breach catastrophe.
