The impact of wealth on family offices: philanthropy and succession planning take centre stage

New study highlights the growing importance of succession planning and philanthropy in family offices amidst increasing wealth.

A recent study by Ocorian, a provider of services to high-net-worth individuals and family offices, financial institutions, asset managers, and corporates, found that the rise in wealth managed by family offices is leading to an increase in philanthropy and highlighting the need for better succession planning.  

The international study surveyed over 130 family office professionals responsible for around $62.425 billion in assets under management, with 46% strongly agreeing that more needs to be done around succession planning. This was especially prominent in smaller family offices that don’t have a natural succession of wealth and leadership. While 88% of family office professionals can see a natural succession of wealth and leadership within the families they manage, 8% don’t and 5% are unsure.  

An increase in philanthropic activities

Given this increased attention to succession planning, more UHNW’s are investing in philanthropy opportunities. Moreover, the study shows that 91% of those questioned expect an increase in charitable giving over the next three years, with 29% predicting a dramatic increase. However, only 25% currently receive support from third-party organisations that aid with philanthropy. With this significant increase in charitable giving, 62% of families surveyed are planning to outsource philanthropy (third-party organisations that specialise in philanthropy donations or advisory), over the next three years, with 23% indicating they will need to do so dramatically. 

Embedding positive impact and sustainability into the family office

Amy Collins, Head of Family Office at Ocorian, stated that “for many high-net-worth families, succession planning can be difficult and emotional and something that they’ve put off”. However, as family offices continue to grow exponentially, increasing wealth is putting more emphasis on impact investing and sustainable business models.  

Collins continues by saying that “with increasing wealth, many are becoming increasingly philanthropic and putting more emphasis on impact investing and sustainable business models. Some are working more closely with causes they care about, and others are using it to engage with the next generation. Both succession planning and philanthropy can be extremely complex, and family offices must ensure they are accessing the right expert advice to make sure their hard-earned wealth is supporting the causes that are close to their hearts, in line with their tailored, personal, philanthropic strategies.” 

Balancing these objectives alongside succession planning and engaging the next generation, can be complex, which is why family offices must ensure they are accessing the right expert advice to ensure their hard-earned wealth is supporting causes that align with the family’s wider purpose and values. 

For more information, read the full report by Ocorian here.

About the author:

Georgina Murrin is a ESG Analyst in Itriom’s London Office.

About Itriom

Itriom is the global impact platform helping leading families shape a better world.  Itriom’s platform enables families to refresh and redesign their values, aligns them with the right UN Sustainable Development Goals, combining them in an agreed purpose and a Family Impact Charter.  Itriom’s platform supports the development of impact initiatives and whilst providing discrete and secure spaces for peer-to-peer messaging and collaboration. Itriom’s core practices in Leadership, Geostrategy, and Sustainability benefit clients by developing strategies to engage and support the Next Generation in building a lasting legacy of which families can be proud. 

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Alizah Beg

ESG Consultant

Alizah is an ESG Consultant and researcher. She supports Itriom developing sustainability related products and services, helping our clients identify potential opportunities for creating positive environmental, social and sustainable impact.

Georgina Murrin

ESG Analyst

Georgie is an ESG Analyst and researcher. She researches trends, develops insights and reports, and writes insight articles on sustainability and ESG related topics to ensure Itriom’s clients are up to date on the latest policy, progress and initiatives to inform the platform and help our clients maximise their positive impact.

Tim Boughton

Senior Partner
Practice Leader – Leadership & Resilience

Renowned family office thought leader, Tim works with UHNW families to ensure they are fully equipped to deliver their legacies inter-generationally and effectively.

Dr. Herb Castillo

Associate Partner
Practice Leader – Sustainability

Dr. Herb creates methodologies and frameworks for managing, measuring and assessing sustainability performance. His work identifies where maximum impact can be made.

Simon Hulland-Lucas

Senior Partner
Practice Leader – Geostrategy

Simon harnesses research, liaison and networks globally to identify opportunities for Itriom, building the knowledge needed to deliver intergeneration legacies for UHNW families.

Matthew Millard-Beer

Managing Partner
Practice Leader – Strategy

Matthew is Founder & CEO of Itriom, providing solutions and a global platform for Ultra High Net Worth Principals and their families to engage in unifying purpose, enduring legacy, and sustainable impact.