Here’s an interesting development in the family office arena - the growth of the principle-driven private investment group. OK, it’s not exactly mainstream, but such investment officers are gaining in popularity, and might well become mainstream in twenty, or even ten years time.
Unsurprisingly, principle-driven family officers are being led by the next generation of wealth owners - Millennials and Generation Xers. These family offices are placing the importance of achieving what they see as positive outcomes for society at the heart of their investment efforts. So, unlike a traditional family office that may have a big philanthropic arm and/or a few social impact investment initiatives, these family offices are placing socio-economic outcomes at the centre of their investment focus.
Perhaps the best-known example of this trend is a family office called Blue Haven Initiative, set up by Liesel Pritzker Simmons and her husband Ian Simmons, which is completely committed to impact investing. But others are also being set up with similar commitments. A family office founded by an Australian entrepreneur called Radek Sali is also focusing on better socioeconomic outcomes. Sali sold his company called Swisse, a maker of vitamins and other health products, for A$1.67 billion in October 2015, and he subsequently set up an investment group called the Light Warrior Group.
Light Warrior Group is run by an ex-Goldman Sachs investment banker called Adam Gregory - so it’s certainly got some heavyweight credentials behind it. Here’s an interesting interview Sali gave to his alma mater about his business thinking, which he’s also instilling into his investment office. He sums this thinking up by saying he wants to grow the business but also wants to make the world a better place. OK, take that statement for what you will, but this thinking is uppermost among young, highly successful business people like Sali, and it’s being translated into how they invest.
Another family office driven by similar ideas is PDP Holding, which manages the money of one of the members of the Volkswagen/Porsche family called Peter Daniell Porsche, who like Sali is in his early 40s. PDP Holding says as part of its mission statement that it is: “...more interested in the responsible handling of resources, future-oriented business ideas, appropriate economic success and commitment to social responsibility.”
Clearly, there is a trend developing, which will more than likely influence the culture and values of family offices in the future. It’s worth keeping an eye on.