Family Offices face a unique challenge in recruitment and retention. They compete not only with other Family Offices but also with large corporations and investment firms that offer highly lucrative and structured career paths to their prospective candidates.
While Family Offices provide distinctive non-financial advantages, such as stability and purpose-driven work, compensation remains a decisive factor in attracting and retaining top professionals. The best candidates often weigh purpose against pay, and without competitive, well-structured packages, Family Offices risk losing out on exceptional talent.
Effective compensation is more than just pay. It is a strategic lever that strengthens loyalty, aligns employee motivation with family objectives, and demonstrates the family’s long-term commitment to its people.
Why Compensation Matters in Family Offices
As the number of Family Offices grows, so does the competition for experienced professionals. High demand and limited supply mean that robust compensation frameworks are essential to attract and retain talent.
Poorly designed packages can lead to high turnover, cultural misalignment, and challenges in recruiting skilled professionals. In contrast, well-structured frameworks ensure longevity, engagement, and continuity, all of which are vital in the close-knit environment of a Family Office.
Key Components of Effective Compensation Structures
- Base Salary
- Salaries must remain competitive with market benchmarks to attract high-calibre professionals. Family Offices that fail to keep pace risk being priced out of the talent market.
- Bonuses
- Performance bonuses are essential to incentivise employees and should directly reflect the family’s priorities, whether it is investment returns, governance outcomes, or legacy preservation. Bonuses tied to these objectives ensure that employees remain focused on what matters most to the family.
- Long-term Incentive Plans (LTIP)
- Retention is critical in Family Offices, where longevity, continuity and trust are highly valued. LTIP’s, such as co-investment opportunities or carried interest, can foster loyalty while aligning employee interests with those of the family.
- Non-Financial Benefits
- Flexibility, professional development, and purpose-driven incentives often weigh just as heavily as financial rewards. Family Offices that highlight their unique working environment gain an edge in the talent market.
The Role of Benchmarking and External Expertise
Designing compensation in isolation is risky. Without access to market data, Family Offices can easily overpay, underpay, or create incentives that misalign with their goals.
This is where benchmarking becomes invaluable. Agreus has years of experience partnering with Family Offices worldwide, supported by a global database of Family Office compensation packages. This data provides unique insights into how peers structure pay, ensuring families remain competitive.
In addition, the Agreus and KPMG Global Family Office Compensation Benchmark Report, designed exclusively for the Family Office community, offers the most comprehensive study of its kind, providing transparency across roles, regions, and structures. The 2025 edition, in partnership with KPMG Private Enterprise, will be released later this month and provides families unparalleled visibility into compensation trends and practices, enabling them to design strategies with confidence.
Common Mistakes to Avoid
- Over-reliance on corporate benchmarks: Family Offices are not corporations. Adopting corporate pay frameworks or relying on non-specialist advice can create misalignment.
- Neglecting LTIPs: Considering the nature of Family Offices, focusing solely on salary and short-term bonuses can undermine retention.
- Poor communication: Lack of clarity around performance expectations and reward structures can erode trust and engagement, in the intimate setting of a Family Office.
Compensation in Family Offices is far more than a financial transaction. It is a strategic tool that fosters loyalty, engagement, and long-term performance. With competition for talent at an all-time high, designing tailored, thoughtful structures is essential.
Agreus is uniquely positioned to support this process. With deep expertise in Family Office compensation consulting and access to proprietary global benchmarking data, we help families craft compensation strategies that are competitive, fair, and fully aligned with their values and long-term vision.
You can find more information about the Compensation consulting service we offer and the benefits it offers on our website.