According to the data provided by Forbes’ 2020 White Paper on Family Offices in China, 20.9% of family businesses have used family office services. Among the remaining family businesses that have not used family office services, 63.2% are interested in learning more about family offices. It can be seen that the helms of Chinese family businesses have realized that in-depth cooperation with professional family offices is a blind medicine to solve family inheritance problems.
So, what is a family office? It is an institution that provides a full range of wealth management and family services for ultra-high net worth individuals and families. According to the scope of services, it is generally divided into single family office and joint family office. A single-family office is set up by a single family and only serves the needs of the family and its members, while a joint family office serves multiple families. These families may not be related. Some joint family offices are even owned by third parties and adopt a business model. Operations.
The key function of the family office is wealth management, but it is not limited to this. It is generally believed that the family office has four main functions:
Investment and wealth management: The family office is responsible for acting as the investment manager of the family wealth, including formulating appropriate investment guidelines, asset allocation strategies, and tracking investment performance. The family office usually also provides financial planning services for each family member to help them achieve their life goals, such as carrying out charitable causes.
Inheritance management: Inheritance management includes estate planning, transfer, etc., as well as succession planning. Ultra-high net worth families often require the family office to provide relevant training and seminars for future generations in the fields of wealth management, business knowledge, and life planning.
Consultation and family governance: The family office will provide professional consulting advice to the family in taxation, law and other aspects. It will also help customers sort out family culture and establish family governance structure to maintain good family governance and make the family permanent Continue the inheritance.
Other family affairs: From paying bills, managing expenses, arranging family meetings and other related daily affairs, to other types of concierge services, everything.
In order to better perform these functions, the location of the family office, in addition to being close to the daily activities of the family, is often more inclined to be established in a mature financial market, so as to effectively obtain different investment opportunities and comprehensive financial services, Mature supervision and legal framework to protect assets, enjoy a stable tax system and sufficient supply of talents.