Family offices are planning to boost the outsourcing of core services as they look to benefit from professional expertise and improve services, according to Ocorian.

Its study of family office professionals found that current advice on illiquid investments and personal finances were the services most likely to be outsourced to third parties.

Around 62% of family offices currently outsource for advice on illiquid investments, 59% receive support with personal finances for family members, and 52% outsource for extended family services, the research showed.

Nearly half (44%) of family office professionals expected outsourcing of illiquid investment advice to increase ‘dramatically’ over the next three years, while 41% forecast a dramatic rise in outsourcing for ‘assets of passion’, and 40% predicted a significant increase for extended family services, such as concierge.

Almost a third (31%) expected a dramatic increase in the outsourcing of personal financial management.

While 30% of family offices currently outsource for wealth planning services, 38% forecast this to increase dramatically and 40% predicted it to increase.

Ocorian said that the key reasons driving the increased use of third parties were the value of professional expertise and advice for the family office, and a focus on improving service levels.

To meet this growing demand, family offices expected third-party providers to evolve, with 70% of respondents anticipating them to be able to provide access to an increasingly globalised network of administration centres, while 60% wanted to see more skills from providers, such as being able to advise on digital assets.

“Family offices clearly value third party support and advice with high levels of outsourcing across a range of services,” said Ocorian global head of private client, Annerien Hurter.

“That is set to increase over the next three years according to the research as family offices look for more support.

"What’s clear from other segments of our research in tandem with our experience is that family offices are increasingly adopting institutional-level governance and investment strategies, with a strong focus on professionalisation and diversification.

“By outsourcing complex areas like private equity to outsourced chief investment officers, they can maintain control over liquid assets while navigating the challenges of illiquidity.

“As these offices become more sophisticated, the trend is clearly moving toward outsourcing more investment functions to access top talent and ensure greater efficiency.

“It's essential for advisers and service providers alike to deeply understand the unique risk appetite and governance needs of each family, ensuring transparency and trust in every decision. The key to success for third-party providers will be being able to offer a seamless global service."

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