Crafting an Effective Mission Statement for your Family Office

Are you sure about the clear goals and values you want your family office to have? Maybe you're thinking about having your professional team focus on making as much money as possible every year, no matter the risks. Or perhaps you'd rather they prioritize preserving wealth for the next generation. Have you taken the time to consider what values and priorities you want your team to follow?

Just like in life, there isn't a one-size-fits-all approach to setting up a family office. That's why it's essential to begin by creating a mission statement that clearly outlines the values, goals, and purposes of your family office. This mission statement provides clear guidance for your professionals, helping them make daily decisions and serving as a basis for evaluating their performance over time.

Furthermore, a mission statement also brings clarity to your spouse, children, and future generations. It helps them understand your family's values and the family office's goals as they manage their current finances and plan for the future. Crafting a well-thought-out mission statement can also reduce potential conflicts among family members by creating a common foundation for the family office.

Creating the Statement

A typical mission statement includes the family's purpose, values, and goals, as well as expectations for the family office and family foundation. It should be concise and easy to understand, with a long-term focus to serve both current and future generations.

Building a mission statement isn't overly complex, but it does require time and effort. It starts with an open discussion involving all family members. It's often helpful to have an impartial, unbiased professional facilitate this discussion to gather input from everyone without stirring up emotional issues. Ensuring the input of family members from different generations is crucial; this diversity of perspectives can lead to a more robust statement that reflects everyone's goals.

After the discussion, analyze the family members' comments to identify areas of agreement and divergence regarding the family's mission. Further conversations may be needed to clarify certain points, such as the balance between financial risks and returns.

Once the mission statement is written and discussed with the family, it should be shared with your family office professionals to ensure they understand the family's purpose, values, and goals and how these will affect their work.

Family Foundations

The same principles apply when creating a Family Foundation. These foundations are not only a great way to engage the family in philanthropy but also to pass down values from one generation to the next. The mission statement for a family foundation should encompass its purpose, values, and funding priorities. While it's important to consider a wide range of sectors that interest the family, due diligence is essential when choosing non-profit organizations for philanthropic support.

Rather than making numerous small donations to many charities, a more focused approach can be effective. Consider allocating fewer grants to causes that matter most to your family, such as medical research, education, healthcare, or environmental sustainability.

Creating a mission statement for your family foundation should be a structured process that gathers objective feedback and builds consensus around your philanthropic vision and values.

Be Open to Change

Finally, keep in mind that a mission statement for a family office or foundation may need revisiting over time. Changes in family structure, relationships, or outlook, such as divorce, remarriage, or the birth of a child, may require adjustments. Remember that a mission statement is a dynamic document, offering valuable guidance to support your family's evolving needs.