Family offices in Europe believe that improving governance is their biggest challenge and agree that more needs to be done to address succession planning, research from Ocorian has found.

The firm’s study of family office professionals across Europe, including the UK, revealed that 83 per cent felt that enhancing governance of the family office to ensure the needs and expectations of family members were met was a key challenge.

Meanwhile, nearly half (46 per cent) believed that the need to upgrade technology was a key challenge, while 39 per cent highlighted the challenge of maintaining confidentiality and privacy.

Almost all (98 per cent) of those surveyed agreed that more needed to be done about family offices’ succession planning, with 17 per cent strongly agreeing.

Just under half (49 per cent) of family office professionals had developed a ‘strong’ succession plan over the past five years as part of an increase in professionalisation, according to Ocorian.

Its research also found that 84 per cent of respondents had seen their family office open more offices in different jurisdictions over the past five years, with 73 per cent citing family members increasingly moving abroad as a key driver for this.

Meanwhile, 52 per cent pointed to their investment portfolio becoming more diversified and reducing the geopolitical risk to the family as reasons for opening more offices.

Almost all (92 per cent) reported a rise in family members having multiple citizenships over the past five years, with 85 per cent expecting this trend to continue for the next five years.

Commenting on the findings, Ocorian commercial director – private client, Michael Harman, said: “Governance and ensuring all family members have a say in the running of the family office is clearly the biggest priority for European family offices and one that they are already addressing through work on succession planning.

“Good governance helps to ensure family harmony which in turn helps the family office to run smoothly and achieve its objectives.

“The family offices we work with are very much global and we see the number of offices expanding in line with this; our next-gen clients, often in their 30s and 40s, are truly international and have schooled, studied, lived and worked in a multiple of countries so their governance, structuring and planning requirements naturally reflect this.”

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