Book Review - Family Offices: The STEP Handbook for Advisers

Thursday, 05 November 2015
Book Review by Melissa Langa - Family Offices: The STEP Handbook for Advisers - an important tool to facilitate meaningful discussions about the viability of a family office for a particular client.

Edited by Clare Archer and Barbara R Hauser
Reviewed by Melissa Langa

With the publication of Family Offices: The STEP Handbook For Advisers, Clare Archer and Barbara R Hauser, the Editors, have raced ahead of rivals in the world of family office scholarship. Bringing together 52 of the brightest minds in the field, Archer and Hauser have provided the family advisor with an important tool to facilitate meaningful discussions about the viability of a family office for a particular client.

Form and function

At 419 pages, the book is broken down into two sections. In the first, 20 chapters tackle individual issues that arise within a family office, from formation to termination. In the second, 11 areas are discussed in detail: Australia, Canada, the Gulf region, Hong Kong, India, Israel, the Netherlands, Russia, Switzerland, the UK and the US. In each section, chapters range in length from a handful of pages to just over 20, most with helpful checklists and diagrams. With an average chapter length of about 12 to 15 pages, this reviewer found the book particularly easy to read on her daily commute, completing a chapter a day.

Before examining two sample chapters in depth, a word to the advisor who might think this book is not for them because they do not have the high-net-worth (HNW) client base with the resources to form and operate a family office: guess again. This book has application outside the family office world. Many of the chapters in the first section focus on issues that are as important to a family charitable endeavour as they are to a family office: structure, governance, family values and mission statements, investments, and conflict resolution, to name a few. Kirby Rosplock’s chapter on ‘Family values, mission, and vision and the family office’ is a perfect example of the wide-ranging usefulness of this book.

Handy first half

Let’s turn to the sample chapters. Within the ‘nuts and bolts’ first section of the book is William S Wyman’s chapter ‘Family offices and technology: the challenge, approach, and opportunity’. Wyman begins by laying out the technological challenges faced by a multi-generation family office, where individual family members inevitably exhibit wide-ranging levels of technical skills and interest. How are the competing but equally important goals of privacy, access and collaboration met across these skill levels? How does the family office balance cost with keeping current?

To answer these questions, Wyman provides the advisor with several pages of thought-provoking reflections on topics such as operations, planning, security, reporting, access, reputation and compliance. This methodical approach to the issue of family office technology culminates in a seven-point ‘next steps’ blueprint for action.

Worldly wisdom

Within the jurisdictional second section of the book, Aditya Gadge’s chapter on India represents the wealth of information this latter part provides. Gadge starts out by noting India’s special challenges, including a tendency towards family feuds; a weak legal infrastructure; a failure to harness the intellectual capital of female family members; a lack of uniformity in law and culture; the historical failure to separate business wealth from private wealth; and the relatively recent accumulation of HNW family wealth. Yet India’s special strength may be its historical emphasis on the family, with Gadge pointing out that the concept of a family office in an unstructured form has a long history in India.

The challenges for the advisor, says Gadge, are to bring structure to the family operation; to permit outside professionals to become privy to family discussions while ensuring the highest level of discretion, which is so important in India; to broaden the Indian family’s economic perspective beyond maintenance of the current family business enterprise to include the formation of new avenues of wealth through venture capital and hedge fund investment strategies; and to engage all family members in the forward movement of the family regardless of age or gender.

The inevitable overlap that occurs when many authors contribute to a book on a single topic has been artfully kept to a minimum by Archer and Hauser. Their careful eye and editorial judgment has resulted in a comprehensive book that is readable and informative.

Publisher: Globe Law and Business
ISBN: 9781909416024
Price: GBP130
STEP member price: GBP104 (to obtain your discount code, log into www.step.org/books)

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Melissa Langa

Melissa Langa TEP is Managing Director at Bove & Langa, PC in Boston, Massachusetts.  

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