What are the primary reasons for setting up a family office? Citi Private Bank’s recently released “2024 Global Family Office Survey Insights” took a look at the primary focuses of respondents’ family offices:
- Investment management: 93%
- Accounting, reporting, tax and administrative services: 68%
- Fostering family unity and continuity: 34%
- Philanthropy: 21%
- Lifestyle management: 16%
These focus areas did not differ much between larger and smaller family offices. The survey did uncover some regional differences, however. Investment management and accounting were the most commonly cited purposes for all regions. Among Asia Pacific family offices, 30% cited lifestyle management as a focus — almost double the global average. Almost half (49%) of Latin American family offices said fostering family unity and continuity was a primary focus. And North American family offices were most likely to cite philanthropy as a major focus (35%).
The survey also looked at the services family offices provide, both internally and externally. It found that a substantial number of family offices use both internal and external resources for specialized functions such as investment management (43%), tax (41%) and wealth planning (41%). One-third (33%) of family offices provide family education internally, and an additional 28% do so with full or partial external resources.
The services least likely to be provided:
- Lifestyle management (42% do not offer)
- Family education (39% do not offer)
- Philanthropy (30% do not offer)
The survey found a number of widespread practices that indicate increased professionalization of family offices:
- Separate from the family business (71%)
- Clear processes and internal controls (62%)
- Governing board (50%)
- Formal strategic plan (47%)
- Leadership succession plan (35%)
- Formal risk management plan (35%)
