In today’s volatile environment, sophisticated family offices are being pushed to confront the tension between ownership and professional management. Salman Mahdi, Global Vice Chairman of Deutsche Bank Private Bank, explores how families can adapt to this changing landscape while safeguarding their legacy, impact, and purpose.
In recent years, the operating environment for family offices has generally become more complex, forcing a re-examination of long-standing assumptions about oversight, decision-making and governance.
Families that created their wealth through entrepreneurial control often try to replicate founder‑style decision‑making inside the office, keeping investment calls, hiring, and even risk management tightly in family hands.
This model is becoming increasingly fragile. What were once relatively straightforward choices are now shaped by an evolving investment landscape, cross‑border assets, heightened regulatory scrutiny, and growing exposure to operational and cyber risks.
At the same time, many families are navigating generational transitions, evolving stakeholder expectations and a broader definition of success that extends beyond financial returns to legacy, impact and purpose.
Families that articulate a coherent purpose – linking financial objectives with legacy, impact and values – are better positioned to harness professional management to advance that vision across generations.
Salman Mahdi
Global Vice Chairman
Against this backdrop, sophisticated family offices may increasingly encounter tensions: how to retain the strategic authority and identity that come with ownership, while embracing the professional management, institutional discipline and specialist expertise required to operate effectively in the demanding landscape of a fast-changing world.
How family offices may be able to build resilience
Navigating complex asset classes, geopolitical shocks and multi‑jurisdictional tax and legal regimes now requires institutional‑grade governance, specialist talent and robust operating processes.
Family offices increasingly resemble diversified investment organisations operating across multiple markets and strategies. This evolution demands a conscious act of “letting go”: a calculated separation of the rights and responsibilities of ownership from the mechanisms of management.
Formal governance structures – family councils, investment committees, and boards with independent members – allow families to set values, objectives, and risk appetite at the owner level, while empowering professional CEOs and CIOs to operate within clearly defined mandates and accountability.
This separation clarifies decision rights, may support speed and quality of execution, and could contribute to a foundation for succession planning. It also may help support a disciplined approach to portfolio construction and liquidity management. Professional teams may be able to build and stress-test integrated risk frameworks, calibrate exposure to illiquid assets, and manage direct deals and co-investments with the discipline of a mid-market financial sponsor rather than a private investor.
A long-term vision
Crucially, letting go of day-to-day management does not necessarily mean surrendering the family’s identity or long-term vision. On the contrary, families that articulate a coherent purpose – linking financial objectives with legacy, impact and values – are better positioned to harness professional management to advance that vision across generations.
Next generation family members can be meaningfully engaged through structured roles in governance bodies and dedicated innovation or impact capital sleeves, rather than informal influence over individual deals.
Technology and data platforms, overseen by professional management but aligned with owner priorities, may provide families transparent oversight without micromanagement.
In this emerging landscape, the most resilient family offices are those that accept the emotional difficulty of letting go of operational control, while doubling down on their true role: long‑term stewards of capital, culture and continuity.
