For the past month, this committed and enthused editor has been locked away in a secure facility, pouring over some very secret and confidential data in a bid to come up with this year’s Merrill Lynch/Campden Research European Single Family Office Report – the second of our annual investigations into the state of SFOs.
This has been a completely engrossing and utterly rewarding affair for me, talking to many of you in person and compiling what I think is a very useful benchmark for the community. We won’t be releasing this report until mid February, but read Jotter in this edition of Campden FO for a sneak preview of some of our findings.
This issue’s Podium section sees Paddy Walker of the Leon Group kindly providing us with some insight into the total revamp of its investment strategies that the Hampstead-based fourth generation family office has undergone over the past twelve months or so.
Admittedly, it did take some cajoling and persuasion to get him to put pen to paper, but as I said to Paddy one December afternoon on the phone – mid plead, no less – the steps that Leon has been taking to keep in line with their founding principles whilst adjusting their portfolio amidst the present malaise have been nothing but inspirational.
And they serve as a great example to us all. As Paddy so aptly says himself: “Under the group’s Articles, Leon can’t take leverage onto the group’s balance sheet. For 9.99 years in any decade, it is surprisingly difficult to articulate this across the dinner table. But right now we are in that 0.01 part of the decade.”
From Ben Bland, our man in Singapore, comes a very insightful cover story about wealth in Asia and the slow uptake of the family office concept. The key problem, of course, is the business culture in Asia, which is dominated by secrecy. The family patriarch and their sons are not willing to give up control or put too much transparency into the situation.
This desire for high levels of confidentiality also means that Asian businesses are unlikely to turn to the multi-family office structure that has become popular in Europe despite the clear cost benefits. But nonetheless, family offices are becoming more popular. And many families are realising that by their very nature, they are the best solution to problems surrounding confidentiality and control of one’s own fortunes.
In Family Ties two leading specialists in their fields weigh in on some very serious family issues. The nature of pre-nuptial agreements was thrust into the spotlight late last year when the UK’s Privy Council heard the case of MacLeod v MacLeod, an American couple resident on the Isle of Man. Mishcon de Reya’s Sandra Davis explains that this case calls into question the validity of such agreements and has far-reaching ramifications for any couple divorcing in the UK or Commonwealth countries.
Finally, governance expert Tom Davidow investigates the aftermath of the Bernard Madoff betrayal and examines the possible psychological impact to family members who may have been caught up in the scam. The duplicity has already claimed lives but Davidow warns the worst may be yet to come.
The stress that comes with a loss like this can be debilitating. Some will experience feelings akin to a messy divorce forces. Parents may face their greatest fear: that they haven’t prepared the next generation for self-reliance and a productive life. Tom warns that for some, it may be a long journey back. A journey that may take generations.