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5 things we know about family office progression

By Alexandra Newlove

Campden Wealth’s European Family Office Conference turns 20 this year, and will once again bring together more than 150 leaders, next-gens, and top executives from family offices.

Held at The Royal Society in London, the theme of this year’s conference is “Progression of the Family Office” focusing on how the family enterprise is evolving and adapting for a multi-generational future.

Peter Newton, Campden Wealth’s events director, said this year’s programme explores issues including ethics, leadership, structure, investments and governance.

“The vast majority of the people speaking over the four days are family members themselves,” Newton said.

As we begin the three month countdown to the conference held on 6-7 November, we take a look at some of the five top trends in family office progression:

1 — The number of family offices is growing, particularly in Emerging Markets, and Campden Wealth analysis shows there are about 5,400 private family offices in existence worldwide. However, some using the family office label are essentially boutique investment managers looking to generate new business by acquiring families. The European Family Office Conference is a family-to-family learning environment strictly limited to qualifying families, wealth holders and their senior executives, and is not aimed at third-party run commercial offices.

2 — Ethics is one of the key themes at this year’s conference, and we know that social and environmental impact is a key concern for families. Campden researchers have found almost a third of family offices are engaged in impact investing—a figure we expect to see grow this year. But difficulties remain identifying attractive deals and measuring impact, alongside concerns about the immaturity of the industry. Some families prefer to focus on sweating their traditional portfolios, enabling them to give more to “pure” philanthropy. More than 90% of families we engage with are active philanthropists.

3 — As private equity investors globally struggle with adequate deal flow at this late stage in the business cycle, family offices are increasingly interested in doing deals with other families, with nearly half (49.3%) of those surveyed for The Global Family Office Report (GFOR) 2017 saying they wanted to do more co-investment. Participating family offices took part in 6.7 co-investment deals over the year, 47.5% were family-to-family deals, and 96.9% found their investment partners through personal networks. The European Family Office Conference offers unparalleled peer-to-peer networking in a private environment.

4 — While the boom in the use of the term “family office” has taken hold in the past decade, the concept in fact has its roots in the sixth century, when a king’s steward was responsible for the king’s wealth, and often the aristocracy, according to EY’s Family Office Guide. The first modern family office belonged to the legendary financier J.P. Morgan, who set up the House of Morgan in 1838 to manage his family’s wealth.

5 — Future and legacy will be key themes at the conference, and 69% of the family offices surveyed for the GFOR expect to undergo a generational transition in the next 15 years. Yet many are still grappling with their succession plans (just 29% have a formal written plan). Providing a platform on which the next generation can excel is essential to the multi-generational family office. But without first understanding the next-gen and building a strategy that suits both them and the office, a legacy is hard to build. At the conference, our current and next-gen family members show you how.

Bringing all the expert insight, knowledge and experience from family members and their senior executives, the 2018 European Family Office Conference will help you build a strategy for all areas of your private office to ensure long term success and progression for generations to come, Newton said.

For more information on the event, and to register to attend, please click here

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