How Should a New Office Document Conflicts of Interest?

A new office should put conflict rules in a written ethics policy. It should state what to disclose, who reviews disclosures, and how the office records its decisions. Apply the policy to family members, employees, and outside relationships relevant to the office.

Define Conflicts and Disclosure

Describe situations where personal interests could conflict with the interests of the family office or its clients. Examples include related-party transactions, a staff member's financial interest in a vendor, gifts, personal use of office assets, and investment opportunities involving an employee or family member. Require disclosure before a decision, even if the person believes the conflict will not affect their judgment.

The ethics policy should set expectations for family members and employees. It should also cover vendors, privacy, gifts, and how to report concerns. Tailor the policy to the office's operations and investments. The governance guide can help connect it to decision rights and oversight.

Set a Review and Approval Path

Name the person or group that receives disclosures. Depending on the matter, review may sit with the CEO, compliance lead, board, or an independent director. The reviewer should decide whether the person may participate, whether another approval is needed, and what conditions will manage the conflict. For significant related-party transactions, state the approval requirement and record who reviewed the matter.

Keep a consistent record for each disclosure: the date, people involved, nature of the interest, reviewer, decision, conditions, and any recusal. Store it with the relevant transaction or governance materials. This record helps show whether the policy was followed and supports consistent treatment of similar situations. For legal specifics, have your attorney review the process and the language of contracts or entity documents.

Review the Policy in Practice

Tell family members and staff when disclosure is required. Explain how to raise a concern to vendors as well. Give employees a confidential route to report an issue to a compliance officer or board member. Review the conflict register at governance meetings. Update the policy when the office adds services, entities, staff, or outside clients.

Address conflicts before they affect a decision. If the office invests alongside clients or family members, document how opportunities are allocated and how the office handles competing interests. Keep financial approvals separate enough that one person cannot quietly approve and record their own transaction. The asset safeguards guide covers related controls, while the staff compliance guide addresses employee expectations. Use the committees and advisory boards guide to consider who should oversee difficult decisions.

An ethics policy should explain what acceptable behavior as a family member or employee of the family office is.

Sources: How to Start a Family Office, The Single Family Office. Informational only, not financial, legal or tax advice.