Linda Mack of Mack International led a thematic roundtable on Family Office ‘Remuneration, Recruitment, and Retention’ at Campden Wealth’s 19th Annual North American Family Office Forum November 20 and 21 in West Palm Beach, FL.
WEST PALM BEACH, Fla., Jan. 4, 2025 /PRNewswire/ — Every year Campden Wealth’s Family Office Forum includes the ability for participants to experience networking by attending a member-led thematic roundtable. Each hour-long thematic networking session provides the opportunity to choose a micro subject to share knowledge and experiences, gain insight and seek guidance from fellow community members. This year Linda Mack of Mack International was chosen to facilitate a discussion on the subject of recruiting, remuneration and retention.
Recent surveys show the majority of family offices report recruitment, compensation and retention as some of their greatest challenges. Increased competition for talent continues to grow, and consequently, compensation practices are a hot topic. Current trends and best practices were discussed surrounding recruiting, retaining, and remuneration.
Starting with the Foundation
The group discussed the importance of asking the right questions when building a family office. For whom are you building it? What scope of clients will it serve? What services will be offered, and will they be insourced or outsourced? Linda drew the analogy between starting a family office and building a house. “You cannot build it room by room; you have to start with a blueprint defining the vision and objectives for the next 10-15 years.”
Recruiting Key Leadership Talent
On recruitment, defining what you are looking for and the criteria you will use prior to going to market is crucial. Linda talked about the two reasons most Family Office searches fail. “The first is that the family finds someone they like and trust, but the individual hired does not have the requisite skills and competencies to be successful in the position because the job was not clearly defined in the context of 10-15 years. The second is the family hires a “rock star” from another enterprise in terms of their perceived requisite skills but they fail because they are not the right culture fit. While the majority of offices are looking for someone with a particular skill set and experience, in fact, culture fit with the family is paramount for success.”
Assessment Tools
One the selection criteria and position description are defined and in sync, it’s time to determine the assessment tools to be used. Participants agreed there are many tools available and often used in combination. The tools discussed that were most popular (and effective) included structured interviews, behavioral interviews, open ended questions, behavioral assessments, evaluation forms and case studies or presentations. Linda emphasized that none of these are a “silver bullet”, but in thoughtful combination can reveal a candidate’s behavior, critical thinking, motivation, and communication style.
Compensation
There is no doubt family offices need to be increasingly competitive to attract and retain talent, so compensation continues to be a hot topic. The table talked about important things to keep in mind when developing compensation plans—benchmarking, legal and tax considerations and the idea of testing any plan to predict the consequences of any incentive. Trends included the use of a variety of Long Term Incentives (LTIs). Linda shared that the most prevalent LTIs used in the market today are supplemental deferred compensation, co-investment opportunities and carried interest.
In Linda’s experience, the type of program will depend upon a family office’s philosophy and approach. “Incentives work. So it is important to be sure that any incentive program is carefully designed to incent behavior that is aligned with your values, goals and objectives.” While published surveys on compensation are now available and more accurate than ever, interpreting and applying the information correctly is critical. Linda advised obtaining expert advice to tailor any compensation program.
About Mack International LLC
Mack International is the premier boutique firm that specializes in providing retained C-suite executive search and strategic human capital consulting solutions to family office, investment firm and enterprise clients on a national and international basis. Clients range from first generation business enterprise owning wealth creators to multi-generational families of six or more generations. Headquartered in West Palm Beach, Florida, clients also include multi-client family offices and select investment and wealth management firms that serve family offices and ultra-high net worth clients. In addition to its executive search services, Mack International provides customized strategic human capital/talent management consulting solutions. The scope of consulting services includes succession planning, governance, next generation engagement, compensation practices, and performance metrics. Founder and President, Linda C. Mack has established proprietary methodologies such as the Mack 360© and is credited for having coined the term “expert generalist” in the industry.
SOURCE Mack International, LLC
