Starting or creating a family office
What Should a Family Consider When the Wealth Creator Wants to Retain Control?
Short answer. Define what control means in practice, then decide which decisions the wealth creator will keep, share, or delegate. Put authority, reporting, and review processes in writing. This lets the office respect the wealth creator's preferences while giving staff enough clarity to carry out agreed responsibilities.
When the wealth creator wants to retain control, make the boundaries explicit before the office is built. Families often use control to mean different things, from approving major investments to choosing every adviser. A clear definition helps the office operate without repeated uncertainty.
Specify the Decisions That Matter
List the decisions the wealth creator wants to make personally, those that require consultation, and those that can be delegated. This may include investment strategy, direct deals, hiring, spending, and the selection of outside providers. Distinguish strategic choices from routine execution. A family may want the wealth creator to set direction while allowing the office leader to manage ordinary work within approved limits.
For investments, review each area separately. A family that built wealth in a particular industry may prefer to remain closely involved there, while relying on outside managers for other parts of the portfolio. In my experience, control preferences can differ across investment categories, so avoid treating the whole portfolio as one decision.
Pair Authority With Information
Control is difficult to exercise without timely, understandable reporting. Agree on what the office will report, how often, and who receives it. Set a process for reviewing performance, fees, risks, and conflicts. If the wealth creator wants direct involvement, define how questions and approvals move through the team so staff are not receiving competing instructions from different relatives.
Write down approval limits and escalation steps. The office leader should know when to act, when to consult, and when to wait for authorization. A governance framework can help organize those rules, while the investment committee guide can help the family decide how investment discussion and approvals should work.
Plan for Continuity
Retained control can create a bottleneck if only one person knows the reasoning behind important choices. Document the office's policies, key relationships, and processes. Decide who can make time-sensitive decisions if the wealth creator is unavailable, and identify how authority changes if capacity or circumstances change. Talk with your attorney and CPA about legal and tax specifics.
Discuss the proposed arrangement with the family members who will be affected. Some may expect a voice in decisions; others may prefer the wealth creator to remain responsible. A defined process helps surface those expectations early and reduces the chance that staff become the middle of a family disagreement.
Review the Arrangement as Needs Change
Control does not have to be all or nothing. The family can retain authority over a narrow set of decisions and delegate routine work, then review whether the arrangement is working. The goal is to preserve the wealth creator's intended role while making responsibilities clear enough for the office to function.
Read next: How does the choice of structure affect who controls the office?
The most important thing to consider while reviewing these three areas is, which of the six levels of potential control do you want to retain for each of these three areas of investment?
Sources: Centimillionaire Strategies. Informational only, not financial, legal or tax advice.