Willingness to modify behavior patterns for digital safety have to grow in parallel with incremental cybersecurity awareness and protection.
Family offices feel a strong sense of duty to protect the privacy of the ultra-high net worth families they serve. Regardless of whether family members are high profile business owners and executives, celebrities, sports personalities or famous philanthropists, there is an expectation that a family office will take sufficient and effective measures to safeguard the privacy of a family’s actions, assets and personal affairs.
However, the challenge continues to grow in magnitude as we continue to move towards a digitized world. The information revolution has not only changed the way we view privacy; it also has fundamentally changed our expectations of it from many angles. Smart devices (phones, tablets, and connected gadgets) are now ubiquitous, with nearly everyone in many parts of the world not only owning one, but also relying on it for many of their routine tasks.
With most people always carrying their smartphones with them, there is also an expectation we are ‘available and there’ at all times. Furthermore, people’s willingness to share their information – whether knowingly or unknowingly – is staggering and growing. For example, emails, phone numbers, social networking, websites and search engine histories, contacts, friend lists, photos, locations, and device usage are all ‘shared’ in one form or another with third parties who can keep this information forever.
In a world where we are all crunched for time and people want effective results instantly, many share personal data to ease a process without fully realizing the consequences of their actions before and after. Moreover, today’s digital world has a long memory and even well-crafted attempts to delete information can fail to achieve the desired effect.
Privacy breaches are often the prelude to reputational damage to wealthy families and their family offices. For example, leaked emails could have detrimental effects on the professional reputation of a family business by revealing confidential proposed business transactions or family information that should remain private.
Family offices’ privacy threats
Family offices face many challenges trying to achieve a myriad of goals set by their principals – investment returns, family harmony, philanthropy, perpetuating wealth across generations, wealth education, convenience, services - while maintaining a family’s rightful desire for discretion and a private life. Recent legislative, regulatory, and policy initiatives in various countries have attempted to establish norms in the name of privacy, however, a global standard remains elusive.
In this white paper, we will look at the privacy threats that wealthy families and their family offices face and examine how family offices can look to identify, manage, and mitigate those dangers as part of a robust risk management program.