Why Protecting the Reputation of Family Offices is Vital for Success
It’s a time when family offices should start telling their stories, or they risk having those stories told for them.
Transparency is one of the most desirable traits that consumers look for when choosing who they should do business with. Demands for transparency have transformed the financial services industry over the last two decades, though private wealth has managed to remain free from scrutiny to the extent that it stays out of trouble. However, this is changing.
When firms gain influence within the economy and society, they would actively switch their focus on defence for their brands, think differently about marketing and engage in reputation management.
Family offices remained quiet and out of the visor, but will soon be pressed to tell their stories, if they haven’t already. Taking a pro-active approach towards telling their own stories means that the next generation of family fortunes can pursue social impact investing with an established reputation.
Furthermore there is a need to recruit investment talent in a world where job seekers want to work for firms with healthy corporate cultures and strong values.
Family offices are the result of years of successful entrepreneurship. A successful business, usually outside the financial industry grows to a magnitude that outpaces the industry and the assets are formed into an investment company. As family offices grew in influence, they now compete for deals that were previously solely addressed by private equity funds.
To compete with banks and private equity firms for business, family offices will use their stories to attract the best deals.
Telling the positive stories behind impactful investments in businesses and communities will help diminish criticism and negative publicity. It will also be crucial towards introducing changes in corporate behaviour through shareholder and public activism.
Getting the Best Talent
Family offices due to their nature of business need to compete for the best investment talent and that means creating a company culture and brand. The largest family offices have hundreds of employees, but manage significant amounts of wealth while engaging in a wide array of activities.
Due to their continuous expansion, family offices now have access to talent that would have previously only considered working at banks, hedge funds or large asset managers. Highly skilled finance professionals are willing to consider working for family offices, which provide better work-life balance and positions of greater responsibility.
Guarding a family’s reputation is important, and family offices are part of how this can be achieved. Protecting a family’s best interests for family offices has become far more important than hard money.