Articles of Interest

The following is a selection of articles and presentations on private wealth and other topics of interest from respected authors and industry commentators.

Investment Policy: Bridle of Want

Richard M. Ennis, CFA
Investors desire return, but successful investment requires more than the desire; it needs an investment policy grounded in investor capacities to bear risk, to hold illiquid assets, and to exploit security mispricing.
(From CFA Institute, Financial Analysts Journal, March/April 2007)
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Passport Portfolio™ Diversification: How Choosing the Right Mix of Residences and Passports is Essential to Preserving Wealth over Generations

David Lesperance, Lesperance & Associates, Toronto
In this paper on Passport Portfolio™ diversification, Canadian multi-jurisdictional tax lawyer David Lesperance makes an interesting argument that getting this issue ‘right’ will be the most important factor in determining whether clients maintain and grow their wealth over their lifetime and future generations. If you think that he is overstating its importance, it is worth remembering that the decisions made by our own ancestors to move from their country of origin had a profound effect on the course of not only their own lives, but those of the generations that followed them.
(From The International Bar Association, 14th Annual International Wealth Transfer Practice Conference, Fall 2008)
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The Wealth Management Industry and Today’s Wealth-Owning Families: From Chaos comes Opportunity

Philip Marcovici, Partner, Baker & McKenzie, Zurich
Traditionally, whether acknowledged or not, a focus of international wealth management has been to use bank secrecy laws for the purpose of tax avoidance. An unstoppable trend toward greater global transparency, however, is rendering this model obsolete. International wealth managers who fail to adapt will not survive. Philip Marcovici is an internationally renowned expert on global wealth management and leads Baker & McKenzie’s worldwide Wealth Management practice. He was born in Montreal, practiced and lived in Hong King and now makes his home in Zurich.
(From CFA Institute Conference Proceedings Quarterly, Dec. 2007)
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Immigrants and Natives to Wealth

Dr. Jim Grubman, Turner’s Falls, and Dr. Dennis Jaffe, San Francisco
A surprising statistic is that over 80% of wealthy households have achieved their position within one generation. Only 20% of the wealthy have been raised with inherited wealth. First-generation wealthy families (“New Money”) are much like immigrants, having travelled from the economic culture of their birth to a much higher economic level. Those marrying into wealthy families from a more modest background are also immigrants of a different type who make the journey suddenly. Many of the stresses experienced by individuals, couples, and families of affluence are similar to other types of immigrant experience, including the strains between first-generation parents and their native-born children and grandchildren.
(Northwood Family Office version, July 2009)
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Raising Responsible Children with Wealth

Dr. Jim Grubman, Family Wealth Consulting, Turner’s Falls
One of the worries most consistently voiced by families of affluence is how to raise children who are productive, motivated, responsible, and generous. In this article, our friend and clinical psychologist Dr. Jim Grubman explains how this task is difficult both for parents who have acquired wealth during their lifetime and for parents who were raised amidst wealth themselves. See the link below for a list of educational resources about parenting skills and the white paper written by Dr. Jim Grubman.
(From Calibre Advisory Services Whitepaper, May 2006)
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Is a Family Office Within Reach?

Jon Carroll, Family Office Metrics, New York
In this article, our friend Jon Carroll comments on how, similar to successful companies, as families grow and prosper, they may find themselves needing more resources to manage their assets; they may need a family office. New options are making this support available for more families today.
(From Wealth, Financial Perspective from Northern Trust, Winter 2006)
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Six Dimensions of Wealth: Leaving the Fullest Value of Your Wealth to Your Heirs

Dr. Dennis Jaffe, April 2003, San Francisco
In the broadest sense, estate and financial planning involve helping families pass on their wealth so that the next generation uses it wisely and well. Passing a pile of money to heirs is not a complete solution, as we see from the predominantly sad stories of lottery winners. Heirs must be prepared to receive their wealth and learn to use it according to the values of the family. To help them, they must inherit not only financial wealth, but many other capabilities, connections and resources that prepare them to achieve the highest and best purposes of their inheritances. This article by Dr. Dennis Jaffe explores six forms of wealth that families can pass on to their heirs.
(From Journal of Financial Planning, April 2003)
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The Functions of a Family Office

Jon Carroll, Family Office Metrics, Fall 2001, New York
Families today face the challenge of keeping family wealth in the family, while continuing the legacy of the wealth creator. Families who successfully share values through generations will preserve and expand the family’s wealth. In this now-classic article, John Carroll of Family Office Metrics, outlines why the most effective approach for a family of significant wealth to preserve and enhance its wealth through the generations is by the creation of a properly functioning family office.
(From The Journal of Wealth Management, Fall 2001)
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