How family offices are reacting to the Paradise papers

We held a roundtable in London on Tuesday for 11 SFOs and I wanted to share some of the thoughts on a Chatham House basis.

The themes on family office executives minds are data security, reputation and regulation.

Maybe this isn’t surprising given the Paradise Papers but I do detect that families are thinking more about actively managing their reputation and the old days of trying to pretend not to exist are gone. In my experience families want discretion, but absolute secrecy can raise more questions and in the end be counter-productive if the wider public believes (often wrongly) that the families interests are harmful to wider society.

I also can’t help but feel that the environment for some kind of regulation or registration is closing upon us. While we may know that family offices have a benign or positive impact, we should not necessarily be surprised that civil servants and politicians do not understand what we do unless we have an opportunity to explain. My experience is engagement with the right people at the right time can ward off burdensome regulation.

Nevertheless its clear most families remain hostile to the idea, and many don’t want to engage because they think it will attract unwanted attention. They don’t see the public benefit of regulating or registering family offices. Indeed it is right to say that where they invest for one family there is no possibility of harm to the consumer. Equally, the danger is that the government comes forward with burdensome proposals because it remains ignorant of the activities and benefits of family office investment.

Your thoughts welcome.