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What happens to a family office when it loses its principal and CIO in quick succession?

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Alta Advisers is one of the UK’s biggest single-family offices, managing billions of dollars from the Rausing family’s fortune, one of the world’s biggest. In the space of a few weeks, it’s principal, Hans Rausing, has died and its director of investments, Tilly Franklin, has departed. What happens next?

Of course, Alta Advisers isn’t going to tell the world what their immediate plans are given these changes. They have no obligation to do so. But given Hans was 93 when he died, his investment office has no doubt planned for his death and has a succession plan in place. And Alta Advisers will either promote someone within the firm to the vacant CIO job, or recruit someone from outside. So no big deal. 

Does Alta Advisers become something like a Ford Foundation, whereby the original family behind the setting up of a family office/foundation has less to do with an organisation set up by an earlier generation?  

Well, not entirely. Succession, as Family Capital has written about before, doesn’t follow as easily at a family office as it might do at a family business. And even if Alta Advisers has a seamless succession plan in place, it’s unlikely to progress as smoothly in real life as it does on paper. There are likely to be many unanswered questions. 

Hans had three children – Lisbet, Sigrid, and Hans Kristian. Hans’ wife Märit Rausing is still alive. Publicly available sources suggest none of Hans’ children, nor his wife, sits on the board of  Alta Advisers, although they might sit on another board that ultimately controls the family office – there are no publicly available sources confirming this. 

Also, it’s difficult to know whether they are direct beneficiaries of the investment profits of the family office, given that reports suggest all profits from Alta Advisers go to charity. 

Lisbet, Sigrid, and Hans Kristian have their own charitable foundations – Arcadia, the Sigrid Rausing Trust, and the Julia and Hans Rausing Trust. So whether they would want to give over more of their time to Alta Advisers is questionable. 

That said, the Rausing siblings are very private, so it’s difficult to know exactly what their feelings are at this time beyond their grief following their father’s death.  And, of course, it’s not inconceivable that one of them will step up and take control of the reins at Alta Advisers and invigorate it with a new family member. 

But Alta Advisers is likely to have been run somewhat removed from the family for some time. Hans’ age suggested he might not have been involved very actively. And given Alta Advisers beneficiary is the charitable sector, does it even matter what the family’s relationship is to the investment office? Arguably, probably not. 

But all this begs the question of what exactly is the relationship the family has with an investment office/foundation started by a member of the previous generation who’s just died, particularly if the family aren’t beneficiaries. Does Alta Advisers become something like a Ford Foundation, whereby the original family behind the setting up of a family office/foundation has less to do with an organisation set up by an earlier generation?  

Effectively, like the Ford Foundation, could Alta Advisers develop an organisational and bureaucratic structure removed from the next generation? 

If that happens, then inevitably, those who run that organisation will gain more power and influence at the expense of the family. As, indeed, what happened at the Ford Foundation. 

So for Hans’ children and his grandchildren, there is much to ponder in the months ahead with no easy answers. 

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