The role of the Chief Financial Officer in family offices has become more complex and consequential. Far beyond traditional financial oversight, today’s CFO is a strategic partner, tasked with preserving and growing multi-generational family wealth and legacies. While the specific needs of each family office will vary, we’ve observed several key characteristics that are consistently prioritized in the search for today’s ideal CFO.

With more than three decades of experience advising family offices, our team has witnessed a clear and growing shift: the demand for strategic CFOs is accelerating. This trend is particularly pronounced in family offices, whether newly formed or well-established, as they look to increase their assets, prepare for succession, or elevate their operational capabilities.

The Evolving Role of the Family Office CFO

The modern family office CFO must combine deep technical expertise with a nuanced understanding of the interpersonal dynamics unique to family environments. Identifying the right leader for this multifaceted role is no longer just about financial acumen—it’s about finding someone who can navigate complexity, provide long-term strategic vision, and build trust across family generations. From managing intricate investments, tax strategies, and regulatory compliance, a skilled CFO provides centralized oversight to reduce risk and ensure transparency.

Their impact is particularly significant during succession planning, where wealth transfer brings challenges like tax optimization and family governance. CFOs design strategies that preserve both assets and family values, while also guiding philanthropic efforts to align financial resources with legacy goals. By educating family members and simplifying complex financial matters, CFOs foster harmony and create governance structures that sustain long-term wealth.

As family offices embrace digital transformation, CFOs are now leading the adoption of new technologies, including AI, to streamline operations and enhance decision-making. Leveraging data analytics, they uncover trends, optimize portfolios, and strengthen cybersecurity, ensuring families remain competitive and secure in an ever-evolving financial environment.

What to Look for When Recruiting a Family Office CFO

Selecting a CFO is not about identifying a jack-of-all-trades but a professional whose expertise aligns with the specific needs and vision for the office. While technical proficiency in areas like financial planning, asset management, and compliance is a must, the most successful candidates also bring strategic vision and emotional intelligence to the table.  The endgame is finding someone that will have the unwavering trust of the family.  This is easy to say, but often difficult to achieve. However, we have found there are five core competencies that most family offices prioritize when evaluating and selecting their next CFO.

1. Cultural Fit: A family office CFO must align with the family’s values and integrate seamlessly into its culture. Unlike corporate settings, where professional detachment often prevails, family offices demand a high degree of trust and alignment with their unique ethos. A CFO must be able to build relationships based on discretion, respect, and a shared vision.

2. Strategic Vision: The ideal candidate combines technical proficiency with strategic foresight. Whether managing global investments, navigating complex tax structures, or leading ESG initiatives, a forward-thinking CFO adds significant value by aligning financial strategies with long-term family objectives.

3. Adaptability: Given the evolving nature of family dynamics and financial markets, a successful CFO must exhibit agility and a willingness to embrace change. This includes staying ahead of regulatory shifts, adapting to new investment opportunities, and guiding the family through transitions such as leadership succession or market volatility.  We have seen many successful family offices transition into full-blown asset managers. So, it is important for them to think about what is needed today but with an eye towards the future. By fostering a culture of continuous learning and improvement, CFOs can ensure that the family office stays ahead of the curve.

4. Interpersonal Skills: As the liaison between family members and external advisors, a CFO must communicate effectively across varied audiences. They should be adept at simplifying complex financial concepts for non-experts and facilitating open dialogue within the family.

5. Technological Expertise: In an era of rapid digital transformation, a tech-savvy CFO is invaluable. From streamlining operations with advanced systems to implementing robust cybersecurity measures, technology-driven innovation enhances efficiency and protects sensitive financial data. An experienced CFO who can leverage analytics and models for better decision-making is paramount.

How to Evaluate Candidates for the Role

Identifying and evaluating CFO candidates has become increasingly complex. While some family offices try to utilize their referral networks to find the right CFO, they are frequently unsuccessful when they haven’t created a “success profile” for how the role will help operationalize the vision of the office. As each family office is unique, a great CFO at one family office does not guarantee success at another.

We have found that families should prioritize a rigorous alignment, identification, and evaluation process that includes craft demos, scenario-based assessments, and in-depth interviews. For example, asking candidates to describe their experience with intergenerational wealth transfer or resolving family conflicts can reveal critical insights into their problem-solving abilities and interpersonal skills. Additionally, any formal and back-channel references should be scrutinized to ensure alignment with the family’s expectations for discretion and integrity. Given the sensitive nature of the role, a successful hire must inspire unwavering trust.

With decades of experience advising family offices, RSR Partners is uniquely positioned to help families navigate the complexities of this critical decision. Our specialized team understands that the perfect CFO is not a one-size-fits-all solution but a tailored match for your family’s unique needs and aspirations. We go beyond traditional recruitment by conducting a comprehensive assessment of your family office’s requirements. From understanding your family’s values and financial objectives to identifying the technical and interpersonal attributes necessary for success, our proven approach ensures that we deliver candidates who excel both professionally and culturally. Our experience, reputation, and existing network allow us to get the “real scoop” and back-channel references on almost any candidate.

If your family office is on this journey, we can help you identify a strategic CFO who will act as a catalyst for intergenerational wealth preservation and growth for the future.

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Brett Stephens, Lindsay Griesmeyer, Maryann Bovich and Ed Fowler are members of the Family Office practice at RSR Partners. RSR Partners is a boutique professional services firm headquartered in Greenwich, CT, that specializes in helping Boards and CEOs with their most critical recruiting, selection, and succession needs. The firm was founded in 1993 by industry icon Russell S. Reynolds, Jr. The firm has conducted thousands of projects for Boards and CEOs at public, private equity-backed, and family-owned businesses across a range of industries including asset management, consumer goods and services, industrial, technology, and healthcare.

As mutual fund governance continues to evolve, selecting the right trustees is more important than ever. With over two decades of experience collaborating with well-regarded fund boards, we have identified some trends to consider when choosing your next trustee.

• Financial, Risk, and Regulatory Oversight – Trustees face increased regulatory demands for transparency and accountability. They must be aware of new compliance standards and proactively address risks related to issues such as liquidity and derivatives exposures. Qualified financial experts remain in high demand to bolster fund boards’ knowledge and understanding of complex financial statements and reporting requirements, as well as provide leadership potential for audit committees.

• Demand for Specialized Expertise – Today’s trustees require skills beyond traditional oversight. Investment products on fund platforms continue to grow in variety and complexity. To respond, boards need to add the right mix of trustees who bring functional expertise to the discussion in the boardroom. Areas of specialized skills and talents may include investments (both traditional and alternative); operational oversight; and knowledge of products and distribution platforms. These industry experts also help boards envision and prepare for “what’s coming around the corner.”

• Technological Knowledge – The use of technology is growing in all aspects of the fund industry—such as in the areas of investment process, financial and/or operational audits, and customer interface applications. Trustees must understand how technology is being utilized and assess its effectiveness. Oversight of service providers is also critical to consider any possible risks to delivery of services (such as a cyber-attack or leak of sensitive personal data). Boards have recruited technology expertise to keep up with these trends. 

• Fiduciary Responsibility and Accountability – Shareholders are now more engaged and vocal about their preferences and expectations. For mutual fund boards, trustees must understand the mindset of and role as a fiduciary advocating on behalf of those shareholders. This includes the responsibility to ensure clarity and transparency regarding fund strategies and performance. 

Trustee Search Tips

Recruiting mutual fund trustees has become highly competitive and great talent moves quickly! Based upon the most successful processes and outcomes we have witnessed, here are some recommendations for your next search:

• Start Yesterday – Effective boards recruit before an upcoming retirement. By developing a candidate pipeline well in advance of departures, boards are better able to manage transitions, provide useful overlap of trustees, and ensure effective on-boarding activities.

• Failing to Plan is Planning to Fail – Aim to recruit trustees with leadership potential. Avoiding succession planning may lead to future issues in board leadership.

• Add What You Need; Not What You Lost – With retirements, focus on current board needs and goals while recruiting new trustees. Open seats afford boards the chance to enhance skills and refresh in a non-disruptive fashion. Take advantage of that opportunity.

• Conflict Free – As always, and as soon as possible, it is critical to carefully select and ensure that potential trustees are truly independent and free from any conflict of interest.

• Diversity Matters: Prioritize Talent Over Title – Successful boards have a true mix of talents and abilities. They benefit greatly from the recruitment of a broad array of C-suite and senior leadership professionals with a variety of functional backgrounds and skills. Boards continue to work to capture diversity of thought and experiences to achieve a goal of building a more inclusive and representative culture.

The right trustees can future proof a board and strengthen its foundation. We are here to help you navigate these trends and recruit trustees who will add lasting value.

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Brett Stephens is the CEO of RSR Partners and helps lead the firm’s Board & CEO Services. Maryann Bovich is Co-Head of the firm’s Asset Management practice and Head of the Mutual Fund Trustee practice. 

RSR Partners is a boutique professional services firm headquartered in Greenwich, CT, that specializes in helping Boards and CEOs with their most critical recruiting, selection, and succession needs. The firm was founded in 1993 by industry icon Russell S. Reynolds, Jr. In 2017, the firm expanded its capabilities in Asset Management through the addition of Higdon Partners. Over the past 30 years, the firm has conducted thousands of projects for Boards and CEOs at public, private equity owned, and family-owned businesses across a range of industries including asset management, consumer markets and enterprises, financial services, healthcare, industrial, marketing and digital, and technology. To learn more about RSR Partners, click here.

Leadership Strategies to Ensure the Office Remains Relevant to the Millennial Generation

Much has been written about millennials – individuals born between 1982 and 2004 – who are having a powerful, and sometimes disruptive, impact on organizations, both public and private. Summarizing current research, millennials are:

• Active users of social media
• Detached from tradition
• Less loyal to organizations
• Distrustful of the establishment, and
• Optimistic about a better future through innovation and impact

On its face, this profile suggests possible tensions with the stereotypical view of the family office as simply a vehicle to pass along both family wealth and the traditions of its creators. It also raises critical questions: Will different generations clash over an understanding of what a positive future looks like? Will they clash over how the family’s assets, financial and other, should be managed? Increasingly, family office leaders are expressing frustration over their inability to capture the attention and commitment of millennials. Not surprisingly, reigning leaders in family offices believe that when the baton is passed to the next generation, they will not value or understand the full benefits of collective management of a family’s legacy and wealth. This is no small matter when looking at the size and scope of the intergenerational wealth transfer expected to take place in the decades ahead.   

According to a recent article in Trust and Estates, millennials have surpassed baby boomers as the largest segment of the population. In the coming years, they will inherit more than $30 trillion.

It is a time-honored tradition for family offices to adjust their working model to meet the preferences of succeeding generations.  But will simple tweaks sufficiently address the needs of this disruptive generation and the massive wealth transfer that lies ahead?

Evidence suggests that radical changes are needed to integrate the millennials into the fabric of the family office.  

Today’s family office leaders are refining and reinventing their management strategies to fashion a high-performing office that can serve all generational needs and expectations. At the risk of generalizing about an industry that is well known for the unique structure of each office, three essential strategies have emerged from our research.

Strengthen Your Governance Policies

Reinforce the values that are unique to your family

Millennials appear to be more sophisticated about financial matters than prior generations, are skeptical of authority, and are impatient with dysfunction. This generation values governance structures that facilitate efficient and informed decision-making and candid dialog. Thus, it is essential for family offices to define the roles and responsibilities of each office executive and the charter for each committee. Who, within the family or among outside advisors, has control of which assets, and who has the authority to change existing arrangements? 

If a family governance process has been clarified to answer these questions and to address issues of control and money, this will serve as a means by which problems can be resolved before they become destructive. Make succession plans clear and establish expectations around when the younger generation might begin to assume a leadership role. Develop a budget and business plan for the office. Empower millennials as early as possible and assign them a project for which they will be held accountable. Engage them early and often. While millennial loyalty to institutions can be low, research suggests that they are more inclined to be loyal to individuals. If authentic relationships are developed between family members and office leadership through this work, a higher level of trust will ultimately form between generations. 

For an office to survive multiple generations, the family must have intention, focus, and clarity about its values. John Davis, founder of the Cambridge Institute for Family Enterprise, is a strong believer in families taking the time to reflect on their purpose, characteristics, needs, and aspirations in order to define their overall mission.

With a mission in hand and a strategy established to achieve specific goals, succeeding generations will have a road map in place to survive leadership transitions.  

This begs the question – what happens when the millennials challenge the underlying family values and mission? Industry guru James E. Hughes Jr. has identified a consistent thread among hundreds of international families who have successfully transitioned a family enterprise through multiple generations. These families have pivoted their focus from simply building a great business to building a mission-directed family that reflects the goals of the group. In so doing, they often come to recognize that the value of the family’s human capital is equal to or even greater than the value of their financial assets. To strengthen the bond, it might be useful to reflect on the “family glue” from time to time via candid dialog facilitated by an outside consultant. We highly recommend reading The Voice of the Rising Generation by James E. Hughes Jr., Susan Massenzio, and Keith Walker, where these ideas are explored more fully.

Embrace Transparency

Using technology and new forms of communication

Privacy has historically been the cornerstone of the family office, and families have typically been conservative about the information they provide to the younger generation. Millennials are disrupting this tradition. They share life experiences on Facebook, Instagram, Twitter, TikTok, and Snapchat etc. This poses risks for the families as reputations can be damaged and security concerns arise when millennials are careless about broadly exposing what they do with their lives.

The office head needs to accept the reality of social media and coach the younger family members on how to coach the younger generation to not share private information and to minimize security risk. 

This generation can be impatient; they don’t like to wait. This phenomenon is frankly a good thing; offices have accelerated the implementation of technology upgrades to provide financial data on demand. Millennials are avid networkers and attend conferences to communicate with other offices in the quest for “best practices.” They are virtual learners and like to teach each other. Because millennials have shorter attention spans, family office leaders must integrate new forms of communication such as diagrams, texts, white boards, dashboards, and summary documents, in order to achieve the desired impact. Forget long meetings, white papers, group conference calls, or thick legal documents. Consultants to families report that millennials prefer to receive information via podcast, allowing them to listen and learn when they choose, rather than the imposition of a meeting or conference call.  

In keeping with the tendency of millennials to be transparent about their life activities on social media, this generation wants transparency from the family about its wealth and how it will impact their lives. They want to be brought “under the tent” at a younger age. 

A challenge facing many families is whether younger members have the maturity to handle this information and when is the right time for them to take an active role. Additionally, as millennials are armed with more information about best practices at other offices, they may question whether the family office team is delivering top quality advice and performance. The stakes are high for family office leaders to demonstrate the worthiness of an independent office versus allocating family assets to institutional wealth managers. 

Understand the Quest for Impact

Learning how millennials view the world 

The millennial generation is optimistic about the future and believes that individuals can make a difference – to have social, environmental, and even financial impact on their world. But if you happen to be a millennial in the shadow of a “larger-than-life” patriarch, it can be a challenge to find your role to make that difference.  

The Voice of the Rising Generation addresses this subject both thoroughly and thoughtfully. How can succeeding generations find their “voice” and how can they lead meaningful lives? The authors encourage each family member to define his or her dreams, gain self-knowledge, and develop resilience and independence. 

Many who head offices recognize that empowering a succeeding generation is a life-long journey, and they devote a fair amount of time counseling younger family members on their social and emotional well-being. Some of the largest and most mature offices have created a new full-time position in the office, a Life Long Learning Specialist. The goal is to empower each family member, through shared learning experiences, to make an impact with the tools that are uniquely his or hers. The curriculum goes well beyond financial literacy.  

Millennials like to participate in direct private equity or venture investments rather than the more typical investment program where assets are allocated to third party mangers. To be directly involved in crunching the numbers, preparing spreadsheets, and researching industry trends, they feel they will have more impact on the success of the investment. Increasingly, they are involved in launching new entrepreneurial ventures in virtually every segment of the economy. Since millennials love social media and collaboration, it is not a surprise that they have led the growth of crowdfunding, a vehicle for peer-to-peer investment collaboration. Lastly, millennials are strongly behind the growth of social impact investing, where investments are evaluated through environmental, social, and governance lenses, better known as ESG. Such investments aim to achieve both financial returns as well as having a positive impact on society.   

Private family foundations are useful tools to help keep families together and actualize their shared mission. In fact, making an impact through charitable giving is every bit as important today as it has been in previous generations.

However, millennials approach charitable giving in ways that differ from their parents. In general, volunteering or “doing the work,” feels more satisfying to them than writing a check. Another defining millennial behavior is the desire to touch as many people as possible and to hold charities accountable for their promises. An observation made by an executive of the Silicon Valley Community Foundation that was reported in the the Journal of Philanthropy (9/14,2017) succinctly makes this point: “They want to know impact, scale, how many, and how come. They’re engaged to an extent that people of my generation find uncomfortable.” 

In Conclusion

The three strategies discussed above are designed to help family offices achieve the ultimate goal, which is to build trust with a generation that inherently questions tradition and distrusts the established way of doing things. 

As a family leader, ensure that the family mission is always top of mind, and create a governance structure that facilitates the execution of the mission, open dialog, and conflict resolution.                

Learn to communicate to millennials in ways that will reach them in meaningful and memorable ways.

Be ever mindful of the millennial desire to make an impact:  in investing, in philanthropy, and in their lives.  Nurture human capital as diligently as financial capital.

And keep the faith knowing that the millennials are optimistic about the future.  They are committed to making the world better – in their own unique, and sometimes unorthodox style.   

# # #

Maryann Bovich and Ed Fowler are co-heads of the Asset Management practice. Their clients are traditional and alternative institutional investment firms, endowments, foundations, wealth management firms, and family offices. For all of these clients, they recruit talent in all functional areas including Trustees and all other C-Suite positions. Our dedicated Family Office team, focuses on attracting best-in-class C-Suite talent in the areas of general management, investment, operations, and client service, and has adapted to the profound growth and transformation of family offices nationwide over the past several decades.

Dear Clients and Friends,

2023 was a dynamic and transformative year across the corporate landscape, and so far, we expect this trend to continue in 2024. Leadership in the boardroom and C-Suite has never been more indispensable. From our beginnings as a boutique board advisory firm, to our evolution into a “boardroom-centric” search firm, we are incredibly proud to work with so many companies that believe that great leadership is a competitive advantage, and with candidates who have a genuine and positive impact on the world around them.

One of the ways we celebrate great leadership is with the Russell S. Reynolds, Jr. Chair of the Year Award. The Chair of the Year Award was established in 2023 to celebrate the legacy of Russ Reynolds, an icon of the executive search and board recruiting industry. The award recognizes a Chair who successfully led a Board of Directors through significant business or governance challenges. As featured in Fortune magazine, the inaugural award was presented to Sarah Nash, Chair of Bath & Body Works, at our annual Directors Dinner in New York in October. We were delighted to recognize Sarah’s extraordinary leadership and character. We hope that many of you will nominate a Chair for the award this year and join us at our Directors Dinner in October.

Our Board practice continues to anchor the firm’s activities and provide enhanced insights and connectivity to assist our executive searches across our core practice areas (Asset Management, Consumer, and Industrial Technology). Our collaborative approach – a hallmark of our firm – helped bring to light some of the trends we expect to be explored by boards and C-Suite leadership teams in 2024:

• Alignment of culture, a learning mindset, and diversity of opinions are now more important than ever on boards and C-Suite teams. The world has changed and what worked in the past will not work in the future. It is therefore critical to perform a robust and comprehensive competencies gap analysis at the board level and across key functional leaders. Does the board and the company foster an environment of intellectual curiosity, and an open and constructive dialogue without limiting different viewpoints or alienating members? Having the right culture is the foundational element for high performance.
• Risk governance requires board and executive leaders to focus not only on current and urgent risks, but to also more carefully consider low probability or unknown risks that may have enormous impact on the business. There have been many “black swan” events emerging, and as a result, creative scenario planning is required. Our recent thought piece, The Chief Supply Chain Officer Imperative: Anticipate and Plan for Disruption, discusses the need to develop operational resilience. It also might be worth establishing a committee or an advisory committee to focus on geopolitical risks.
• Don’t be left behind on AI. The NACD recently reported on the acceleration of science, technology, and/or innovation committees formed at the board level, noting that 67 Fortune 500 companies now have one or more of these committees. Does your board and leadership team have the skillset to understand generative AI, emerging/disruptive technologies, and cyber risk? Or do you need to recruit the right talent to help meet these challenges?
• The Universal Proxy Card will now be used in proxy contests to target the performance of individual directors. Activism is also expected to increase in 2024. It is important to establish action plans and accountability. Evaluations can help boards plan for succession and recruit to fill gaps in skills and experience.
• A new risk has emerged – 74% of executives surveyed by Mercer (Global Talent Trends report) stated that the majority of their workforce cannot adapt to the new world of work. People are key to competitive advantage and value creation – it is critical to know in what environments employees are productive and feel appreciated. Human capital management can play a critical role at an organization, especially in light of the new SEC disclosure rules coming in 2024.
• Lastly, board and leadership burnout is real. Time demands and pressure on directors and corporate leaders have increased substantially. Our recent thought piece, The Divergent Voice: A CEO Formula for the Current Fog of Business, discusses the complexities of being a business leader in today’s environment.

We look forward to continuing to assist our clients with their most important, complex, and sensitive leadership and governance concerns in 2024. We believe that RSR Partners is uniquely situated in the industry to provide unparalleled access and insight into top-performing business leaders. In addition to our board recruiting capabilities, we offer our clients a broad set of other Board and CEO services. Should you have any important board or C-Suite leadership needs in the coming year, we would be delighted to share our capabilities and expertise to help you. More importantly, we look forward to our continued friendship with you all. 

With gratitude,

Barrett J. Stephens
Chief Executive Officer
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Grateful. Thankful. Optimistic.

Given the turmoil in the world around us, we can’t help but be more reflective and thankful at this time of year. We are grateful for family and the relationships in our lives. We are thankful for our wonderful clients and those candidates with whom we have partnered. We are optimistic about the new year ahead of us.

As another successful year in search concludes and we look back on 2023, we are sharing below some observations made during the course of our work. We always welcome a conversation with you whether it’s a quick hello or to discuss any specific needs of your organization. Our team looks forward to staying in touch in 2024!

ENDOWMENTS, FOUNDATIONS, AND OCIOs

• Changing of the Guard – After three decades recruiting within the E&F community, it’s hard not to get the sense that the pioneers of the E&F approach are stepping back, and the voice of a next and very capable generation is being heard.
• OCIO Search – The OCIO market has become highly competitive and the ascent of the OCIO search firm as a critical gatekeeper in the space should not be ignored.
• New Territory – Indexing and passive beta are entering the lexicon and finding a home on the mainstream range as credible vehicles for investment.
• Generalist Model – Many clients are adopting generalist models for varied reasons, including better aligning the team with market opportunities – and also with GPs who more and more are blurring lines between traditional asset classes.

FAMILY OFFICES

• Dynamic Market – There has been robust activity with new offices spawning daily and established offices upgrading talent continually.
• Sophisticated Investment Platforms –There is an increasing focus on buying private operating businesses, thus making family offices the biggest competitors to middle market buyout firms.
• CPAs – The demand for top quality financial talent is increasing but CPAs are in short supply.
• Cohesion – A top of mind discussion in many offices is cohesion – how do you keep family generations together and focused on common goals?

MUTUAL FUND BOARDS

• Targeted Expertise – Given the variety and complexity of investment products on fund platforms, boards have a continual need for qualified financial experts and trustees with broad investment experience.
• Strategic thinkers – With the industry undergoing consolidation and experiencing increased regulation, fund boards are looking for strategic thinkers and proven investment leaders to help boards envision and prepare for “what’s coming around the corner.”
• Diversity –Boards continue to work to achieve a goal of building a more inclusive culture and encouraging diversity of background, experience, and thought in the boardroom.
• On-boarding – Mandatory retirements continue to create a dynamic recruiting environment. As boards think strategically about seamless transitions, trustees are being recruited earlier and are provided broader educational programs and formal orientations to assist with on-boarding.

OPERATIONS

• Upgrades – Clients continue to invest heavily in upgrading operational functions to better integrate workflow with the investment process – leadership roles as well as portfolio analytics, risk, and operational due diligence capabilities.
• Forward Thinking – Senior operations roles require a strategic mindset and a comprehensive understanding of investment strategy to better support investment decision making.
• Range – COOs today must be able to deal with a greater range of business, regulatory, and cyber/technology related issues.

INVESTMENT/WEALTH MANAGEMENT

• Client Portfolio Managers – Firms are investing in talent with a blend of client DNA and demonstrated investment acumen for an integrated sales/client service role, as well as proxy for the CIO and investment teams.
• Bench strength – Our clients continue to experience tremendous demand for bench strength, perhaps a lingering effect of the great resignation.
• Analytics & Digital Technology – Distribution and marketing functions are transforming through enhanced use of data analytics and technology, now seen as critical components to a successful sales and client service effort to grow and maintain assets.

REPRESENTATIVE SEARCH WORK

Finding the right Chief Investment Officer (CIO) for a family office has become more complex over the past several years. From our experience working with a wide range of well-established to newly developed family offices, we have found an interesting trend emerging among the most effective CIOs in the marketplace. While undoubtably investment acumen and intelligence are paramount, there are three leadership behaviors and characteristics we have found that ultimately determine the fit and success of a CIO within a family office.

• Ability to Connect and Engage: Family offices are unique in that they serve the specific needs and objectives of a highly successful and prominent family. A CIO must understand and align with the values and goals of the family to ensure that investment strategies and activities are tailored appropriately. This alignment helps in making decisions that not only generate returns but also resonate with the family’s long-term vision and ethical preferences. A CIO who understands and shares the family’s mission can more effectively lead, build, and motivate their team. This shared sense of purpose helps in creating a cohesive work environment where the team is committed to the family’s objectives.

• Ability to Learn and Adapt: For the CIO, continuous learning is fundamental to remaining effective, compliant, and competitive in a fast-paced and ever-changing marketplace. In our evaluation process, we have found it is imperative for the family to understand what information sources CIOs utilize and how they process and absorb information to develop knowledge and make decisions. We always seek to understand how a CIO responds and adapts to the environment and circumstances surrounding them and how they can realign their actions based upon new information.  

• Having Trust and Discretion: Competence is insufficient without character. As trust is the critical component in family offices, one’s moral quotient (MQ) is fundamental. The family needs to understand what values the CIO stands for and how they will lead and manage so that everyone is aligned. This is especially important in a context where decisions are deeply personal and can impact multiple generations. For many families, the family office is far more than a financial management entity; it is a custodian of the family’s reputation and legacy. Trust and discretion are essential in ensuring that this legacy is preserved and passed on to future generations in line with the family’s values and desired impact. 

Selecting the right CIO for a family office requires a careful balance of technical ability and personal qualities. The ideal candidate will align with the family’s vision and values, fit well within the unique culture of the family office, possess a mix of broad business skills and specialized expertise, and demonstrate strong leadership, strategic vision, and empathy. These characteristics will help ensure that the new CIO can successfully manage the family’s wealth and contribute positively to the family office’s long-term financial and non-financial goals.

# # #

Brett Stephens is the CEO of RSR Partners and helps lead the firm’s Board & CEO Services and Maryann Bovich and Ed Fowler are co-heads of the Asset Management practice.

RSR Partners is a boutique professional services firm headquartered in Greenwich, CT, that specializes in helping Boards and CEOs with their most critical recruiting, selection, and succession needs. The firm was founded in 1993 by industry icon Russell S. Reynolds, Jr. The firm has conducted thousands of projects for Boards and CEOs at public, private equity-backed, and family-owned businesses. The firm’s Asset Management Practice, which builds upon the legacy of Higdon Partners and its 30-plus years of experience, has become a premier asset management search and advisory team uniquely positioned to address the changing leadership needs of the $100 trillion asset management industry.

Greenwich, Conn., October 26, 2023 – RSR Partners, a leading board and executive search firm, presented the inaugural Russell S. Reynolds, Jr. Chair of the Year Award to Sarah E. Nash, Chair of the board of Bath & Body Works. The award was presented to Sarah at the firm’s annual Directors Dinner in New York City on October 25, 2023.

The Chair of the Year Award was established to celebrate the legacy of one of the search industry’s greatest leaders and icons, Russ Reynolds, who has spent more than 50 years advising boards and CEOs on leadership. The award recognizes a Chair who successfully led a public company Board of Directors through significant business or governance challenges. The winner of this year’s award was chosen from more than 30 nominations by an independent selection committee comprised of renowned experts in their fields, including Mikaela Boyd, Nik Deogun, Ed Kangas, Kim Lew, Christie Smith, and Brett Stephens.

“Sarah led the Bath & Body Works board through an incredible governance and business transformation,” said Kim Lew, a member of the selection committee. “Her accomplishments include leading the spin-off of Victoria’s Secret; collaborating with the nominating and governance committee on the recruitment of exceptional and highly diverse talent to the board of Bath & Body Works and the new board of Victoria’s Secret; navigating a successful CEO transition and selection process; and building a constructive path forward after an activist campaign. The leadership and integrity exhibited by Sarah is an example of how important board leadership is during times of turbulence. She is very worthy of this award.”

“This award recognizes Sarah’s extraordinary leadership, dedication and service to Bath & Body Works over the past few years,” said Steve Steinour, Chair of the Bath & Body Works Audit Committee. “Sarah served as Bath & Body Works’ Interim CEO with very short notice, where she played a pivotal role in the company’s transformation with its spin-off of Victoria’s Secret. During her tenure, Sarah has exemplified strong business acumen including leading a successful shareholder derivative settlement and navigating a complex supply chain reset with partners. She has exemplary people management skills such as overseeing multiple chief executive officer transitions, recruitment efforts for eight board members, and leading the company during the onset of COVID. We are grateful for her contributions and leadership since her assumption of the role of chair in May 2020.”   

“I’m incredibly proud of my fellow directors and the leadership team at Bath & Body Works,” stated Sarah. “They have shown irrefutable dedication to the vision we all share for this company. Their input and support throughout this past year was invaluable, and we have much to look forward to. I am also grateful to be recognized by an award that pays tribute to Russ, his legacy, and his impact on how board leadership is viewed and valued.”

“Sarah’s terrific,” commented Russ. “She possesses the characteristics of a great leader. She is objective, open to advice, decisive, and a good communicator. She operates with integrity and puts the company’s and others’ needs ahead of her own. I also started my career at JP Morgan, so I was particularly thrilled to see we share a fondness for finance and banking. I look forward to seeing how Sarah develops as a board leader and continuing to celebrate her achievements.”

About Russell S. Reynolds, Jr.

Russell S. Reynolds, Jr. (“Russ”) is an American business executive, author, and founder of two of the search industry’s most prominent firms. Considered one of the pioneers of the executive search and board recruiting profession, Russ has counseled the boards and CEOs of many of the world’s leading companies over the past 50 years. In 1969, he founded Russell Reynolds Associates, which soon became one of the world’s foremost international executive recruiting firms. Russ sold his interest in the firm in 1993. In 1994, Russ founded the Directorship Group, later named RSR Partners, where he served as Founder and Chairman until 2022.

About Sarah E. Nash

Sarah E. Nash has served as Chair of the board of Bath & Body Works, Inc. since January 28, 2023. She served as Executive Chair of Bath & Body Works, Inc. from February 2022 to January 2023 and as the Interim Chief Executive Officer from May to November 2022. Prior to being appointed Executive Chair, she served as Chair of the board between May 2020 and February 2022 after having joined the board as an independent director in May 2019. Sarah is also Chief Executive Officer and owner of privately held Novagard Solutions, an innovator and manufacturer of silicone sealants and coatings and hybrid and foam solutions for the Building Systems, Electronics, EV and Battery and Industrial and Transportation markets.

Sarah spent nearly 30 years in investment banking at JPMorgan Chase & Co. (and predecessor companies), a financial services firm, retiring as Vice Chairman of Global Investment Banking in July 2005. She served on the board of directors of Knoll, Inc., a designer and manufacturer of lifestyle and workplace furnishing, textiles and fine leathers, from 2006 through its acquisition by Herman Miller, Inc. in 2021 and privately held Irving Oil Company through March 2022.

Sarah currently serves on the boards of directors of Blackbaud, Inc., a software company providing technology solutions for the not-for-profit industry, and privately held HBD Industries, Inc., a manufacturer and supplier of general purpose and application-engineered industrial products. Sarah is Trustee of the New York-Presbyterian Hospital, a member of the Smithsonian Tropical Research Institute (STRI), Panama and the Chair of the International Advisory Board of the Montreal Museum of Fine Arts. She also served as a member of the National Board of the Smithsonian Institution through 2022. Sarah holds a BA in political science from Vassar College.

About the Chair of the Year Award

RSR Partners announced the establishment of the Russell S. Reynolds, Jr. Chair of the Year Award in October of 2022. The award will annually recognize the Chair of a public company’s Board of Directors that has successfully led the board through significant business or governance challenges. The award celebrates the legacy of Russell S. Reynolds, Jr. (“Russ”), who has spent more than 50 years advising boards and CEOs on leadership and governance.

To be eligible for the award, a nominee must serve as a Chair of a board of directors at a U.S. public company with revenue or market cap greater than $1 billion. The nomination period takes place from August through September. The winner of the award will be chosen by an independent committee comprised of renowned experts in the areas of strategy, finance, strategic communications, shareholder activism defense, investment management, human capital consulting, and corporate governance. This year’s committee included:

• Mikaela Boyd, Americas Strategy Practice Head of Bain & Company
• Nik Deogun, CEO of the Americas of Brunswick Group
• Ed Kangas, Former Global Chairman and CEO of Deloitte
• Kim Lew, President and CEO of Columbia Investment Management Company
• Christie Smith, Talent & Organization/Human Potential Global Lead of Accenture
• Brett Stephens, CEO of RSR Partners

More information about the award can be found at: www.chairoftheyearaward.com.

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Contacts
Lindsay Griesmeyer
+1 (203) 618-7076
media@rsrpartners.com             

Annual Award Named After Russell S. Reynolds, Jr.

Greenwich, CT, June 8, 2023 – RSR Partners, a leading board and executive search firm, announced today that it has established the Russell S. Reynolds, Jr. Chair of the Year Award. The award will annually recognize the Chair of a public company’s Board of Directors that has successfully led the board through significant business or governance challenges. The award celebrates the legacy of Russell S. Reynolds, Jr. (“Russ”), who has spent more than 50 years advising boards and CEOs on leadership and governance.

“I am honored that this award will become an annual way of recognizing exceptional board leadership,” said Russ. “The real trick in selecting great board leaders is not only focusing on their experience and specific skill sets, but on whether they have the foresight, curiosity, character, and courage to lead.”

The winner of the award will be chosen by an independent committee comprised of renowned experts in the areas of strategy, finance, strategic communications, shareholder activism defense, investment management, human capital consulting, and corporate governance. The committee includes:

• Mikaela Boyd, Americas Strategy Practice Head of Bain & Company
• Nik Deogun, CEO of the Americas of Brunswick Group
• Ed Kangas, Former Global Chairman and CEO of Deloitte
• Kim Lew, President and CEO of Columbia Investment Management
• Christie Smith, Talent & Organization/Human Potential Global Lead of Accenture
• Brett Stephens, CEO of RSR Partners

“Russ has observed how highly effective boards and CEOs operate during their most seminal moments,” stated Brett Stephens, Chief Executive Officer of RSR Partners. “There is no better way to honor Russ’ innate talent for identifying and evaluating leaders than with an award in his name that recognizes the incredible impact a Chair can have on an organization’s leadership and long-term success.”

Public company directors will be invited to submit their recommendations beginning June 8^th. Any Chair of a board of directors at a U.S. public company with revenue or market cap greater than $1 billion may be nominated. The award winner will have successfully led the board and executive team through a significant business or corporate governance challenge. The inaugural winner will be announced in October at RSR Partners’ Annual Directors Dinner in New York City. Information about the award can be found at: www.chairoftheyearaward.com.

About Russell S. Reynolds, Jr.

Russell S. Reynolds, Jr. (“Russ”) is an American business executive, author, and founder of two of the search industry’s most prominent firms. Considered one of the pioneers of today’s executive search and board recruiting profession, Russ has counseled the boards and CEOs of many of the world’s leading companies over the past 50 years. In 1969, he founded Russell Reynolds Associates, which soon became one of the world’s leading international executive recruiting firms. Russ sold his interest in the firm in 1993. In 1994, Russ founded the Directorship Group (later named RSR Partners) where he served as Founder and Chairman until 2022.

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Contacts
Lindsay Griesmeyer
+1 (203) 618-7076
media@rsrpartners.com   

Dear Clients and Friends,                                                                        

We appreciate your continued trust and support. Without the confidence of our valued, long-standing clients and friends, we would not be able to do what we love. As 2023 marks the 30th anniversary of RSR Partners, the new year presents an opportunity to share with you our reflections upon our firm and the marketplace.

In 1993, our Founder, Russ Reynolds, embarked on a journey to create a new firm that was distinct from his first, Russell Reynolds Associates. RSR Partners began as a small board advisory firm, initially well-regarded for its Directorship publication, which is now owned by the National Association of Corporate Directors (NACD). Over time, our firm has grown and evolved to become one of the premier board recruiting and executive search firms engaged by boards and CEOs to advise them on their most important and sensitive search needs. We are unique in our boardroom vantage point, our ability to be selective, and access to the wisdom of an industry icon who acts as our beacon regarding what makes great leaders.

2022 was another productive and impactful year for our firm and our clients and candidates. While our board search and advisory practices continue to be the backbone of the firm, our C-Suite search expertise was utilized across a myriad of industries and situations. Additionally, the firm marked an important milestone this summer when Todd Ruppert seamlessly transitioned into the role of our Chairman, succeeding Russ Reynolds, who continues to provide us with advice and counsel. We were also excited to have Eric Douglas Keene and Dick Hoag join the firm to continue to strengthen the board and CEO services we provide for industrial, consumer, and financial services clients.

As most of our client engagements are confidential, complex, and highly sensitive, we are unable to publicly promote the details around these successes. That said, we are seeing not only an increased demand for our services, but also a growing demand for boards to enhance their capabilities and effectiveness, and for CEOs to address specific gaps in their leadership team.

Some recent examples include:

• Guiding the board of a Fortune 500 consumer products company on Chairman succession and the recruitment of two new board members.
• Advising a large asset management business to identify, assess, and select two new mutual fund trustees.
• Partnering with the CEO and owners on the selection of a CFO for a private equity backed consumer products business.
• Helping the CEO of a Fortune 500 industrial technology company identify, assess, and select a transformational CHRO.
• Advising the CEO on the selection of new CMO for a large pre-IPO private equity backed data and analytics business.
• Providing external CEO succession candidates for a multibillion-dollar family owned industrial and consumer products company.
• Partnering with the board of directors on the recruitment and selection of a new Executive Chairman for a prominent and disruptive leader in the mobility and electrification industry.
• Consulting and recruiting for a prominent family office on the selection of a new CEO and CFO.

We see tremendous opportunity for leaders to rise to the occasion in these still uncertain times. Our society must continue to seek out and support individuals who have the potential to become great leaders, especially with an eye towards the diversity of thought that continues to shape our cultural fabric. Successful companies and communities are only created by having the right people, which continues to be our quest for our firm and for our clients.

We look forward to our anniversary this December with pride in our firm’s past and confidence in its future. In the event you have a sensitive board or executive search needs in the coming year, we would be happy to discuss the situation in confidence.

We wish you and your colleagues much success in 2023 and beyond.

—
Barrett J. Stephens
Chief Executive Officer 
O: +1 (203) 618-7022 
BStephens@RSRPartners.com

The success and longevity of family-owned businesses is often credited to the level of engagement of the family members in the business, the investment and management of the family’s wealth, or both. As a boutique executive search and board governance firm that specializes in championing the unique connection between family-owned businesses and family offices and advising family leadership on talent development and strategy, we at RSR Partners have observed what it takes for families to grow and transition their businesses and wealth from generation to generation. While every family is unique in their makeup, values, and culture, we have recognized a few themes that contribute to high engagement among family members. We are pleased to present this series of blog posts that summarize some of the topics and ideas we have discussed with our clients. Key to high engagement is an education program that appeals to multiple generations, includes a philanthropy component, and weaves a talent development strategy throughout the curriculum. Developing such a program can be a challenging and onerous task. For those of you with this important responsibility, we hope this guidance will be helpful.

1: Bring the Family Together

Annual In-Person Meetings

Bringing the family together in-person as much as possible helps members of the family build relationships and develop a bond of trust, fellowship, and rapport. It can be a challenge for members of the family to commit to in-person meetings. Many of our family clients hold a required, in-person, annual meeting and develop an agenda to keep family members engaged throughout the day (more ideas below).

Developing a Family Charter

If a family does not have a mission statement or a charter, developing one is essential. The family members can revisit the charter during the annual meeting every year. Annual meetings are also a great time to educate and discuss the family’s history and legacy thus far, so that family members are reminded of the effort taken to accomplish the achievements and success the family enjoys.

Overview of the Family Business

The annual meeting agenda also usually includes an overview of the strategic plan for the relevant family business, an explanation of the family’s assets and investment strategy, general educational sessions around financial management, and information regarding the family’s philanthropic efforts. Future blog posts will take a deeper dive into how to educate family members about the business, tailor and evolve the educational sessions for various generations, and discuss the family’s assets and investment strategy.

Philanthropy Day

Another great way to get families together – and to engage with the up-and-coming or next generation – is through an annual “philanthropy day” or session during the annual meeting. A member of the family office can describe what philanthropy is, explain the various categories, and how the family currently contributes wealth and time to these causes. Some families have come up with mock (or even real) dockets and portfolios for the family members to build. This allows the family members to think through their passions and interests and learn from their commitments and mistakes. Some of our clients have done this with family members as young as 7 or 8 years old! This process also often helps family leadership to identify the family members who have an interest in philanthropy and the ability to strategically approach investment opportunities.

Regular Trust Meetings

Many of our family clients also hold regular trust meetings in addition to the annual meeting to ensure that the family members are educated and have a positive relationship with their wealth. Recurring meetings help to remind family members of the importance of understanding the trust instrument, who the beneficiaries are, and how inheritance is distributed over time. Family members who are educated and prepared for milestones tend to handle the related responsibilities with more ease.

Acknowledge Disruption

It can sometimes be helpful for the family to take time during annual meetings to discuss any disruption or disconnection that has impacted the family, the family’s business, wealth, or philanthropy efforts over the previous year. A third-party facilitator or moderator can help with these sessions. It is healthy and productive for the family to acknowledge challenges and work together to overcome them.

Inclusion Policy

It can similarly be helpful to acknowledge that some family members, as well as some spouses, partners, or others who have married into the family, may not be allowed to participate in trust meetings, or other aspects of an annual meeting, depending on the trust documents and how decision making is conducted. Our family clients suggest developing a family inclusion policy that outlines when and how a non-member of the family can be involved in business or family initiatives. Many of those who marry into the family have their own careers and independence but desire to have a voice. Allowing the “outlaws” to have their own session, perhaps with a moderator, at the annual meeting to discuss their roles and how they can contribute tends to be beneficial.

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In sum, families that own businesses and have family offices, and have transitioned through multiple generations successfully, all emphasize that an in-person annual meeting is an important opportunity to underscore and reiterate the family’s mission statement and to build trust and appreciation for one another.

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In our previous post, we discussed how the success and longevity of family-owned businesses are often tied to the family’s level of engagement. Family offices are uniquely positioned to provide education programs that can deepen this engagement with multiple generations, resulting in smoother leadership succession. Bringing the family together for an annual meeting that includes educational sessions is a great first step. Additionally, family leadership should consider the various pathways each family member could follow as they mature and develop.

2. Establish Education Pathways

Generally, family members fall into the following categories: (1) business management/leadership, (2) board member, (3) shareholder, and/or (4) family member. It is best practice to develop an educational program for each pathway, even where many family members may fall into more than one category or move between categories at different point in their lives. A distinction between pathways helps family members understand the varying responsibilities related to each role.

A course schedule and timeline can be developed for each pathway. For the management/leadership tract, consider why and how family members become interested in the business. There may be opportunities to host sessions specifically to inspire curiosity about the business, the relevant industry or market, and the family’s legacy. Next, chart the relevant topics and substantive knowledge the family member should master into a 5- or 10-year roadmap to track progress and set milestones and expectations. This process also serves as a great opportunity for dialogue between family members and current leadership/management to ensure alignment. We note that this pathway should serve as a supplement to, and not a replacement for, a family member’s formal education processes, and it will be most effective when tailored to identify critical gaps in knowledge or experience relative to the family business.

Also, regardless of the pathway, there are some basics that should be covered for those interested in a role with the family business and managing wealth. Spending the time to have these conversations with a combination of older and younger generations can be critical to business transition and succession. We will discuss potential program sessions in our next post.

For the board member and shareholder pathways, consider desired traits and prior successes (and failures) of productive board members and shareholders. Examine the information that will be made available to them and explain key performance indicators that will be used to measure success. For board members, essential topics might include fiduciary duties, responsible decision-making, roles of committees, communications, and maximizing interactions with other board members.

Some family members will either be uninterested or unable to participate in the family business, but their importance to the overall health and success of the company and family should be recognized with an educational pathway. Consider sessions that help parents advise their children as they mature and gain a deeper understanding of the business and their wealth. All family members could benefit from lessons on risk and the potential impacts of their unrelated activities on the family business. Additional ideas for sessions, facilitated or moderated by a professional, include handling stress, publicity, and family dynamics and support.

Prior to each annual meeting, it is helpful for the family office to consider performance and progress through various pathways and then set (or revise) educational goals for the coming year. These goals can and should be aligned with the company’s business plans and/or the family’s wealth management and investment strategies. This prioritization then creates the foundation for sessions at the annual meeting and provides ideas and a trajectory for ongoing courses throughout the year. Blocking dates and times for the ongoing programs at the annual meeting can help establish a rhythm and keep family members on track. An added benefit is that this process demonstrates transparency to all generations, sets the stage for the year, and hopefully furthers trust and buy-in for the educational process from family members.

It may also be necessary to assess whether an individual has the capacity to fully commit to a program. Creative topics can help engage this audience. Knowledge of the courses and timeline for each pathway also empowers family members, as they understand the resources available and can contribute ideas around how each topic is covered. Courses can be mixed and matched depending on how family members learn. The courses can be run by the family office, or can be via an educational institution, professional services firm, guest speakers or others.

Lastly, an advantage to establishing educational pathways is that the process helps leadership observe the development of each family member, gain a sense of each individual’s skills and capabilities, and gauge interest in the business or in wealth management. It can be helpful to identify and create criteria or attributes that are associated with success in each pathway and then put assessments or other tools in place to determine when each individual develops necessary qualities and demonstrates the capabilities to advance to the next stage of their progression. These assessments can include online testing, probing different leadership experiences, or formal written evaluations. This is particularly common for family offices involved in operating businesses. These benchmarks can help family members take the educational program seriously, as they will see and experience how participation and successful completion of programs coincides with their progression within the family business.

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In sum, establishing educational pathways can help family offices and family-owned business engage multiple generations of family members. Spending the time to consider the milestones along each pathway will help facilitate and guide family members to becoming and remaining productive contributors to the business, the family office, and the family itself.

Upcoming Blog Posts:

3: Areas of Education and Who Handles Education / Education Options

5: Education & Succession and Impact of Family Culture on Education

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About Our Family-Owned & Family Office Team

Our dedicated family-owned & family office team focuses on attracting best-in-class investment, financial, operational, and general management talent to the unique benefits of working within a family office. As family offices become more professionalized, with more robust internal investment teams, higher quality investment reporting, and more incentivized compensation structures, clients have relied on us to persuade candidates to move to a family office environment. Our work across traditional asset managers, endowments and foundations, alternative asset managers, outsourced CIO firms, and private wealth management firms enables us to recruit from a broad and diverse candidate base. We have a strong track record of success, and in many cases, we have been enlisted to build our successful candidates’ teams and eventually to recruit their successors. With patient, long-term pools of capital, family offices are increasingly viewed as a stable and stimulating investment management platform, requiring the “best-in-class” talent that RSR can provide. Examples of positions we commonly fill at family offices include:

• Chief Investment Officer
• Chief Operating Officer
• President
• Executive Director
• VP of Operations
• VP/Director of Sales & Marketing
• VP/Director/Manager of Human Resources

RSR Partners is a boutique professional services firm headquartered in Greenwich, CT, that specializes in helping Boards and CEOs with their most critical recruiting, selection, and succession needs. The firm was founded in 1994 by industry icon, Russell S. Reynolds, Jr. The firm has conducted thousands of projects for Boards and CEOs at public, private equity backed, and family-owned businesses across a range of industries including asset management, consumer goods and services, industrial, technology, and healthcare. To learn more about RSR Partners, click here.