The family office (FO) recruitment landscape continues to evolve at pace: A global report of FOs finds that 80% of family office executives get a performance bonus that can be more than 200% of their basic salary. In particular, 58 percent secured a salary raise last year despite economic slowdown.
The figures come from the 2023 Global Family Office Compensation Benchmark Report, published by Agreus Group, the consultancy firm, together with KPMG Private Enterprise, part of KPMG. The findings are based on responses from more than 650 family office executives worldwide. Here are some highlights of the report:
- Performance bonuses and salary increases
- 80% of FO professionals received performance bonuses exceeding 200% of their basic salary.
- 58% of respondents received an uplift in salary last year despite higher inflation.
- 41% received a rise of 6-10% in salary, and 20% chalked up a rise of more than 15%.
- Comparing salary across the continent
- FO chief executives in Asia have a wider range of take-home salary, earning between US$ 119,237 to US$ 377,331.
- In the Americas, FO chief executives take home a salary ranging between US$ 198,001 to US$ 264,000.
- In Europe, FO chief executives are paid ranging from US$ 258,542.78 to US$ 344,722.
- Remote work and adaptation
- 74% of FOs facilitate working from home, reflecting a pandemic-driven trend.
- 61% work in a hybrid workplace and 13% work from home full- time.
- A male-dominated occupation
- Only 21% of FO professionals identify as female, highlighting a male-dominated field.
- The UK has the highest share of female CEOs, at 37 %.
- In Asia, all CEOs were?male.
- The most popular destination for FO
- 9% of the world’s FOs are in Asia, of which 59 % are in Singapore, and 14% are in Hong Kong.
- 62% of FOs in Europe are located in the UK.
Future trends in recruitment approaches
Over the years, FOs have matured from small and intimate entities managing the wealth of individuals and their families, to becoming institutionalized entities that require high-calibre professionals to match.
According to the report, Family Offices are considering compensating their employees for the long term. However, the significant strain on talent witnessed in 2022 will lead family offices to standardize their pay, include long-term incentive structures, and professionalize their overall recruitment approach.
Ultra-high-net-worth (UHNW) families are increasingly implementing employee participation schemes such as profit sharing, embracing B corps, and showing interest in employee ownership trusts in an effort to address this problem. On a personal level, family offices are designing professional compensation structures that motivate excellence and ensure the longevity of their new hires.
There are high chances to see recruitment approach such as carried interest, co-investment opportunities, and long-term performance bonuses will gain popularity for the first time. Notably, these incentives will not only be offered to C-suite family office professionals but also to anyone considered crucial to the operations.