THE family wealth management is essential for families who want to protect and expand your wealth across generations. That heritage may include money, real estate, investments, family businesses, and other valuable assets. The process involves planning and executing strategic actions to preserve and increase these assets over time.
As the family heritage grows, its administration can become complex, leading many families to choose to outsource this function to a family office.
What is a Family Office?
The family office is a service specialized in wealth management for high net worth families. It has a team of qualified professionals to support families in various areas, such as finance, investments, accounting, succession planning and legal matters.
There are two types of family offices:
- Single Family Office (SFO): manages the assets of a single family;
- Multi Family Office (MFO): offers wealth management services to multiple families simultaneously.
These services are very important for families who want to build a lasting legacy based on your values and purposes. The family offices can also play a fundamental role in financial advice and management for sustainable investments and philanthropy with the asset management aiming not only at financial return, but also at positive impact for society and the environment. However, it is crucial that this desire originates within the family itself and is discussed with managers.
Wealth management with positive impact
The way we allocate our resources directly influences the world around us. Growing awareness of social and environmental impacts has led some family offices to rethink your investment strategies. Many of them are allocating resources with the purpose of promoting businesses and organizations with a positive socio-environmental impact.
In Brazil, the interest in practices such as philanthropy, ESG (Environmental, Social, Governance) and impact investments is growing between business families. According to the 2020 INEO report, many of these families are engaged in promoting positive impact, influenced by market movements and the vision of new generations who take on the management of family assets.
Furthermore, research High Net Worth Families in Brazil – Impact Investing and Philanthropy, driven by Sitawi, reveals that in the next 1 to 3 years, the focus is expected to sustainable investments be predominant, followed by the approach finance-first. This shows an optimistic view on the opportunities for impact investing in Brazil.
Family wealth funds
You equity funds, also known as Endowments, are widely used to ensure the financial sustainability in non-profit organizations, such as universities and museums. However, this concept has also been adopted by family offices as a tool for preserve capital across generations. Furthermore, one of the great attractions of these funds is the possibility of align them with the family's philanthropic values. Many use them to leave a lasting legacy, financing projects that have a positive impact on society.
Discover some advantages of this service for family wealth management:
- Heritage preservation: you equity funds : Endowments can be used to ensure that family capital is kept intact over time. This means that the principal of the fund is not used up, allowing family wealth to continue to grow and generate income that will be focused on the positive transformation of society;
- Governance: to ensure that the endowment fund function efficiently and in accordance with the family's objectives, well-structured governance is essential. The family office establishes clear rules for the use of income, ensuring the continuity of the legacy;
- Philanthropy and Impact Investing: one of the most significant roles of equity funds in family offices is the support of positive social and environmental impact. High-income families often use these funds to finance projects with a social and environmental impact, such as education, health, environment and culture. This practice strengthens the family's commitment to causes that are important to them, while promoting social well-being.
Endowments of Brazil
THE Endowments of Brazil, in partnership with the Sitawi Finanças do Bem, offers an innovative approach for families who want to create equity funds. The expertise of this partnership guarantees a solid and efficient management of resources, maximizing financial returns and ensuring that capital is correctly directed to the chosen causes.
With the Endowments of Brazil, it is possible to direct the income of a fund to various causes or institutions, facilitating the allocation of donations in different areas of interest of the donor. In addition to ensuring long-term financial stability, this approach perpetuates support for specific causes and ensures that resources are used as agreed, even many years after the fund was created or the donor passed away.
With a focus on transparency, security and compliance, a Endowments of Brazil facilitates the process of creating and managing endowments, allowing families and donors to leave a lasting legacy. Following the Law 13.800/2019, which regulates endowments in Brazil, we offer a secure structure for these funds to operate effectively.
Check out other benefits of opening a endowment fund with the Endowments of Brazil:
- Guarantee of correct direction of money;
- Flexibility in the use of resources for different causes and purposes
- Simplicity and convenience in legacy implementation;
- Monitoring redirections and accountability.
Are you interested in opening a Heritage Fund and building a legacy for your family? Get in touch with us!
