In this article, the issue of family offices' use and investment into AI is explored, along with strategies for getting more out of this fast-expanding technology.

The following article is from Simon Ward (pictured), corporate partner at leading law firm Farrer & Co. Alongside colleague Amen Alonge (pictured below), Associate, Farrer & Co, he writes about how family offices could and should employ AI. The topic is also one that came up in a recent family office forum hosted in New York, in April, by sister news service Family Wealth Report. (See examples here and here.)

Amen Alonge
 
With more than half of family offices having invested in AI technologies, but far fewer of them using AI for essential tasks, Ward argues there are many benefits waiting to be reaped.The editors are pleased to share these ideas; the standard editorial disclaimers apply. To comment, email tom.burroughes@wealthbriefing.com and amanda.cheesley@clearviewpublishing.com

In recent months, family offices have taken noticeable steps toward adopting artificial intelligence. According to Citi Private Bank’s Global Family Office Survey 2024, more than 53 per cent of family offices globally have now invested in generative AI. Yet, fewer than 15 per cent report using AI for practical applications such as automation, forecasting, or reporting. 

This discrepancy reveals a growing paradox: while family offices are investing in the future, many have not yet begun to use the tools they are buying and building (often at a not inconsiderable cost). The result is a widening gap between AI curiosity and capability, one that private advisers and professional service firms are well placed to help close.

The promise of AI: enhancing how family offices operate
AI has the potential to transform how family offices operate, both day-to-day and at a strategic level. Whether used to automate financial reporting, assist with investment analysis, flag inconsistencies in contracts, or detect cyber risks, we are starting to see AI offer meaningful support across multiple areas which would be relevant for family office environments.

Used thoughtfully, AI can help reinforce good governance. It provides decision-makers with timely insights, improves auditability, and introduces tools for spotting anomalies or irregularities early. This kind of accountable automation holds appeal in a sector that values discretion and resilience.

AI could also ease regulatory pressure. For instance, it can help identify inconsistencies in compliance documentation, help to bring cataloguing and structure to legacy datasets, or flag potential cross-border issues before they become problems. These efficiencies are already shaping the landscape for institutional investors, and family offices may increasingly benefit from similar tools.

Why the gap exists: obstacles to adoption
Despite its potential, most family offices are not yet deploying AI in a sustained or structured way. That is not necessarily due to a lack of interest but rather a combination of structural and cultural factors such as:

-- Data readiness: many offices work with unstructured data, using legacy systems or bespoke tools that make it difficult to produce the kind of clean, consolidated data that AI systems rely on to produce accurate outputs.

-- Privacy and trust: given the highly confidential nature of many family offices’ work, there are understandable concerns around security and control, particularly when third-party tools are involved. Even low-risk applications such as automated presentation building or first-draft legal summaries can raise flags when discretion is paramount. “Many Family Offices aren’t aware that their best strategy may be to tune a local Large Language Model (LLM) as a more accurate, private alternative to Chat GPT”, says Richard Metcalfe of Automated Data Inc, a leader in helping businesses maximise their AI strategy. 

-- Leadership mindset: AI adoption will need support from family principals, board members, and their trusted advisers. Without that, even well-chosen tools may sit unused. And where there is no clear governance model in place, it is understandable that offices will be cautious about the practical and reputational risks, as well as the potential cost of adopting a full AI model.

Bridging the gap: a practical path forward
AI works best when it is approached as a gradual, capability-building process. For family offices looking to move from experimentation to meaningful use, a few core focus areas could help:

-- Foundations: laying the groundwork is essential. That means investing in clean, well-structured data systems and ensuring appropriate safeguards are in place, from access controls to encryption. 

-- Training: while family office teams do not need deep technical expertise, they do need enough understanding to engage meaningfully with AI tools to provide good quality inputs, and to flag issues and exercise judgment over the outputs. “In our engagements with family offices, we often play the role of CTO and CDO (Chief Data Officer), to ensure that the right practices get baked in, and that the adoption of AI is strategically aligned”, continues Richard Metcalfe.

-- Security: with proper oversight, AI can support, rather than undermine, cyber resilience. Many platforms now use AI to enhance threat monitoring, which aligns with family offices' privacy and control priorities.

-- Governance: as with other areas of risk and responsibility, good governance makes the difference. Defining clear roles for review and approval, tracking accountability, and introducing transparency around AI decision-making can go a long way in building internal confidence and trust - and in turn driving the adoption of AI tools.

Preparing for the future: the next generation
AI adoption is also becoming a generational consideration. Many younger family members expect their advisers to reflect a certain level of digital fluency. They are comfortable with automation, generative tools, and real-time dashboards and are often curious about how AI can support their personal or philanthropic goals.

For family offices thinking about succession, this presents a valuable opportunity. Engaging with AI is not just about short-term efficiency; it is a way to remain relevant to the next generation of leaders and decision-makers. And for the advisers supporting them, fluency in these tools is fast becoming part of the skillset they require.

Conclusion: from curiosity to capability
The AI era is here, but implementation is still a work in progress for many corporate investors, and not just family offices. That reflects the careful, long-term mindset that defines the sector. 

As the technology matures and meaningful use cases become clearer, the real opportunity lies in family offices building capability confidently - on their terms, and at their own pace. For family offices willing to engage with AI thoughtfully, the path ahead is less about disruption and more about continuity, resilience, and future readiness.