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Best Practices
Defying Convention
Anne Field
03/01/2005

ROUND UP THE USUAL SUSPECTS. That could well be the motto of most families when it comes to hiring a chief executive to run a family office. Many families draw senior managers from private banking, accounting or other financial backgrounds—the better to look after the primary purpose of the office: managing the family assets.

But families have also espoused much broader missions than simple wealth preservation, spurring some of them to take a radically different tack. They fill senior management positions with people whose core duties pertain to nonfinancial matters—a passionate interest in philanthropy or art, perhaps, or an urgent family need, such as educating family members in decision-making or financial skills. While these executives often have little or no financial background to speak of, they have the management and leadership skills needed for them to serve as the interface between the public and the family office, says Eric Wasserman, head of family office services and managing director of JP Morgan Private Bank in Los Angeles.

While the practice is hardly new among the 3,000 family offices in the United States—wealthy families have hired high-level advisors to help them plan philanthropic missions since the Gilded Age—it has gone on largely below the radar. That is, until recently. “With the explosion of the number of ultra-high-net-worth families and family offices, more organizations have been studying them and sharing information about how they work,” Wasserman says. As a result, the existence of these non-traditional managers is increasingly coming to light.

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