Family Office deep-dive: charting the future

In today's rapidly evolving world, we see that Family Offices are starting to face – or are already undergoing – a significant transformation, both in terms of the areas in which they support the families they work with as well as the types of investments made. As highlighted in the PwC and Julius Baer Family Barometer, affluent families are seeking assistance in navigating the growing complexity brought about by geopolitical diversification. They also seek support in effectively structuring and managing their family wealth. Family Offices can play a critical role in helping families along this journey, flagging issues long before they arise. Assessing risks is a key area of the responsibility of Family Offices.

We also see that there is the potential for Family Offices to be sustainability champions, actively seeking investments that align with environmental and social goals, driving social impact initiatives and contributing to causes that matter to their families and communities. In reality we can see that this process is only just beginning, but it is also clear from PwC’s recent Global Family Office and Deals report that Family Offices are moving further and further away from “traditional” investments and the “traditional” mindset. 

Digital innovation is also at the forefront of this transformation. Whilst every Family Office is at a different stage of the journey, it is clear that by embracing technological advances, Family Offices will become more and more efficient and increasingly add value to the families they serve, whether this is through streamlining operations, enhancing security, data analytics or exploring and analysing new investment opportunities. Key stumbling blocks remain, such as ensuring that data is protected at the highest levels and ensuring that any systems acquired are regularly monitored and maintained in order to ensure that their output is reliable and robust. 

Collaboration has become an essential strategy in the Family Office landscape. At PwC, we see more and more Family Offices teaming up to maximise their impact. This theme of collaboration came through clearly from the Family Barometer, where we witnessed Family Offices forming closer partnerships with advisors – and other Family Offices – to unravel the intricacies of families with international ties.

These collaborative endeavours encompass various aspects, including co-investments, joint philanthropic initiatives and knowledge-sharing both formally and informally. By pooling resources and expertise, Family Offices are achieving more significant outcomes than ever before. This collaborative spirit has the potential to foster a sense of community in this highly confidential sector of the market. Trust is key – as this year’s Barometer reads in its preface.

Sustainability – Environmental, Social, and Governance (ESG) – considerations are no longer optional; they are becoming central to both families and Family Office strategies. It ranks as one of the top five subjects of discussion between families and their investment advisors. At PwC, we are diving deeper into how Family Offices are integrating Sustainability principles into their investment decisions.

Whilst we do not yet see homogeneity across the market, Family Offices who are embracing suitability are actively seeking investments that align with the family’s values and contribute to a more sustainable future. Beyond financial returns, some families are taking up the mantle of global stewards, advocating for responsible business practices and sustainability.

In conclusion, Family Offices are not only adapting to change but also driving it. When performing well, their innovative approach, collaborative spirit and commitment to sustainability and global stewardship will help shape the future of wealth management. 

At PwC, we're committed to supporting families and Family Offices at all stages of their journey. We believe that by harnessing innovation and fostering collaboration, we can help families and the Family Offices that serve them to chart a prosperous and sustainable future.

If you have questions, ideas or if you would like to discuss strategies for your Family Office, please don’t hesitate to reach out to us. Together, we can navigate the evolving landscape of Family Offices and create a brighter future for your family's wealth.