Here, Family Wealth Report talks to London-based Yolande Escher Dwivedi and Jeroen Kwist of BNY Mellon Wealth Management about the globalization of family offices, the challenges and opportunities of this, and issues related to selecting service providers.
At a time of increased globalisation of wealth and geographic dispersion of high net worth individuals, wealthy families often have spouses, children or other contacts in multiple countries due to their resources facilitating more travel, international home ownership and access to sophisticated global investments.
BNY Mellon believes there are clear opportunities for wealthy families to embrace a global family office model and likewise for family offices to capitalise on the business prospects associated with serving international clients.
As families increasingly look beyond their home jurisdictions for investment opportunities, business value chains are spanning more continents, with suppliers in Asia, production in eastern Europe, real estate in the UK and investments in the US, for example. Clearly, the family office sector is evolving in line with this, but facing its own challenges along the way.
Perhaps one of the biggest challenges is around who to trust in an increasingly complex world as families ultimately regard the safety of their physical and financial assets as paramount. There are also often significant differences between the various jurisdictions in which families may operate or have interests – in terms of regulation, investing, tax and visa requirements, to name just a few.
It is therefore crucial that their financial and lifestyle needs can be catered for on a truly global scale, including with sufficient communication “touch points.” Families have understandably come to expect a higher and more “on-call” level of service from their providers.