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Luxembourg B.6041 ING_PB_A4_EN_def.indd 1 21/05/14 13:57 FAMILYELITE OFFICE MAGAZINE ROLLS-ROYCE MCLAREN 19 BNY MELLON UNVEILS - WRAITH HONDA INSPIRED BY FASHION WEALTH MANAGEMENT MONACO GRAND PRIX 2015 11 The Softer Side of the Evolving 33 Canadian Family Office 03 TRACING MASTERPIECE 15 THE PAST RETURNS FOR ITS 6TH EDITION THE ORIGIN OF IMAGES 15 35 INVESTMENT FBAR PENALTIES THOUGHTS IRS IMPOSED FBAR PENALTIES LOYALTY REWARDS: A BETTER FEE STRUCTURE FOR ALL 17 41 PARTNERSHIP OFFLINE THE FAMILY OFFICE AND READING MATTERS FAMILY FOUNDATION URBANOLOGIE 23 45 LUXURY LONDON GUIDE PRIVATE MEN WHO DREAM OF WINE EDUCATION 47 CREATING A STRATEGIC 29 EXECUTIVE SEARCH EDUCATIONAL ROADMAP 27 WEALTH MANAGEMENT 50 1 FAMILY OFFICE ELITE MAGAZINE SUPERYACHT 51 KELLEHER INTERNATIONAL DOUGLAS McFARLANE MATCHMAKING GURU, AMBER KELLEHER-ANDREWS IVORY TRADE 53 CHANGING THE WORLD..ONE MATCH AT A TIME US RESTRICTIONS ON IVORY INVESTING 59 CHINESE POCKET WATCHES 05 UFFO 60 NON-FOR-PROFIT 63 FRANK MULLER MASTER BANKER ETIQUETTE 71 FOR THE 21ST CENTURY BITCOIN 87 ATTRACTS $500M TBLI 109 Values Based Investors THE LUXURY CHANNEL THE BRAINS BEHIND A BRAND 61 2 WWW.FAMILYOFFICEELITE.COM BNY MELLON The Softer Side of the Evolving Canadian Family Office Trevor Hunt Anthony J. Messina The concept of a single family office or multi-family are fundamentally, but not always, dependent on size. office is fairly new to Canada compared with Europe Substantially larger family offices (over $500 million in and the United States. However, particularly since assets) can attract talent which can make it economically 2008, there have been an increasing number of family advantageous to carry out a full-spectrum service whilst offices that have been created upon liquidity events. others may benefit from leveraging resources and This is typically a result of family assets having grown intellectual capital collectively. The latter describes a considerably and required specialised expertise or due multi-family office approach. to first generation family members facing progressively more complexities and embracing sustainable wealth Putting the investment related activities aside, we are transfer to the next generation and beyond. Significant noticing an escalating demand for what some refer to as Canadian families have accumulated wealth through the “softer issues” within the family office environment. various industries, although, predictably, these have often been concentrated within commodities, real These responsibilities may include: estate and infrastructure, and to a lesser extent, 1. Family governance – Most of us have heard of the technology. Given that our firm’s approach here in shirtsleeves to shirtsleeves phenomenon whereby the Canada is most similar to that of the investment arm wealth that has been created by the first generation of a multi-family office, we fully appreciate that no two is significantly diminished if not decimated by the families and no two family offices are alike. On a case- third generation. Family governance formalises the by-case basis there should be sufficient flexibility in process for preparing the family to receive the wealth, deciding which functions are best serviced in-house by rather than merely getting the money ready for the the family offices versus those services which should family. The first step in this process is establishing be out sourced, to ultimately maximise efficiencies open communications and trust within and across and quality of services for the family. These decisions generations. A family office can play a key role here, in 3 FAMILY OFFICE ELITE MAGAZINE convening family “get togethers”. These may start by in Canada has given rise to peer group networking BNY MELLON being purely social gatherings and gradually progress amongst affluent families who share with each other to include more formal discussions and exercises. the challenges and the successes of operating a family This could encompass collaboratively establishing a office in order to establish the optimal practices that family mission statement, deciding on a family vision may be followed. For instance, earlier this month, one based on shared core values, and designing a code of of the senior members of our team attended a private conduct for future meetings. As the family grows in family office conference in the remote location of Banff numbers and wealth, this often also includes defining in Alberta. The audience included family members roles and responsibilities, possibly codified in a family and their advisors from around the country with constitution. representatives from Vancouver, Edmonton, Calgary, Toronto and Montreal. The agenda, for the most part, 2. Education – A key early step in preparing addressed these softer issues with an emphasis on families for their inheritance is educating the people within the family office, family dynamics, beneficiaries so they become better stewards of their governance and education. “By coming together future wealth. This can start with basic instruction on in a forum such as this, families and their advisors different types of investments and does not stop at can learn from each other to a. mitigate potential asset allocation and investment policy knowledge. It pitfalls and b. uncover any hidden opportunities, to should however include: how to select an investment effectively execute best practices.” Said Trevor Hunt, manager, that is, both quantitative and qualitative Wealth Director at BNY Mellon Wealth Management in criteria with arguably a greater emphasis on the latter. Toronto. One facet to be stressed is a deeper understanding of the motivations driving an investment manager’s Although the financial assets of the family office decisions. This can be achieved through asking the may seem paramount, successful multi-generational right questions e.g. how is the investment manager families have demonstrated the value of developing compensated? Does he/she have any of their own human and intellectual capital as well. The softer wealth invested in the underlying strategy? If so, what issues cannot be ignored and are increasingly a focal percentage of their own wealth is invested alongside point for family offices across the country. This is an their investors? area where leadership from a single or multi-family office can be a major plus. 3. Philanthropy – Many financially successful Canadian families are generous and philanthropy is Anthony J. Messina is the President of BNY Mellon one area that is relatively easy for the entire family Wealth Management based in Toronto. The Canadian to be able to participate in. While it’s nice to give business advises on nearly $5bn in assets primarily family members the chance to allocate some of their through third party investment managers and charitable gifts to their own favourite causes, we have predominantly for significant Canadian families in observed that families benefit on many levels when addition to institutions. they dedicate at least a portion of their donations www.bnymellonwealthadvisory.ca to “family philanthropy”. By making a collective decision to contribute to a specific cause or causes that reflect the family’s values, multiple generations participate in joint decision making in a feel good, nonthreatening way. If used correctly, philanthropy can be an effective tool for evaluating differing family members’ communication styles and assist in nurturing decision making capabilities within families and across generations. Like other regions, the evolution of family offices 4 WWW.FAMILYOFFICEELITE.COM MATCHMAKING FOR GOOD KELLEHER INTERNATIONAL Leading with her heart, Amber Kelleher-Andrews is leveraging the success of her family business toward no smaller goal than changing the world. By Mark Dagostino Amber Kelleher-Andrews thought facilitating love connections for a to acquire her services, and the she already had her dream job— long list of business leaders, A-list firm takes on around 20 new clients and with good reason. “How many celebrities, and other high-net- every month. Do a little math and CEOs are in a position to deliver worth individuals at the top of their it’s easy to understand why she bliss and companionship and love game. While she keeps the identity might be smiling. to their clients?” she wonders of her clients closely guarded, aloud from her offices in sunny the press has credited her with And yet, beyond her company’s California. “How many other finding matches for pop star Paula financial success and stellar businesses are businesses of the Abdul, television newswoman reputation for results, Kelleher- heart?” Hoda Kotb, Olympic Gold Medalist Andrews has always cherished Bode Miller, and members of the the fact that the firm itself is For nearly three decades, her firm, DuPont, Getty and Rockefeller a boutique family business. It Kelleher International, has been families. Individuals pay anywhere was founded by her mother, Jill recognized as one of the largest from $25,000 (U.S.) for a one-city Kelleher, nearly thirty years ago, and most-successful high-end search to $200,000 (U.S.) for an and there are numerous members matchmaking firms on the planet, international search, plus bonuses, of their extended family on staff 5 FAMILY OFFICE ELITE MAGAZINE in offices across the U.S. and Europe, including in London. She also finds deep satisfaction with the notion that her profession is about more than just making money: It’s a career aimed at making people happy. “So to say it’s been a dream job for me is an understatement,” Amber says. Still, after the dynamic and photogenic Kelleher-Andrews branched into television back in 2012—lending her talents to a dating show entitled “Ready for Love” on the major American TV network, NBC—she came back to the office feeling as if she had something more to give. “Before I left for the TV show, I had set up the whole company so it could work without my day-to-day management. So when we didn’t get a second season of the show, I thought, Andrews to consider doing far Force For Good,” held twice yearly ‘Well, what do I do now? Do I go more with her talents, and her on Mr. Branson’s privately owned back?’ I wondered if I had done company, than she ever imagined Caribbean retreat, Necker Island. all of this for a reason, for some possible. It’s up to her to put together the greater purpose. I wondered if I perfect guest list. The idea is to might be able to use my time to “He inspired me to think outside “match” world leaders, CEOs, accomplish something more,” of a box that I’d unknowingly kept celebrities, models, sports figures, she says. “That’s when I met my business in,” Kelleher says. and more, to create a dynamic Richard Branson.” “Suddenly I was thinking about group of passionate individuals how I could leverage my skillset of who will come together to inspire Sir Richard Branson’s passionate connecting people into matching each other. It is hoped that these approach to not only making people with a purpose—in the dynamic individuals will gather money but to changing the interest of changing lives.” new ideas to take back to their world for the better is, of course, companies and platforms, all well known. But witnessing that That spark led Kelleher-Andrews while forming powerful new energy in person and learning down a brand-new path—one friendships—or in some cases about the powerful influence that made her “dream job” even relationships—that will ultimately of Branson’s Virgin Unite, the better. Today, she co-hosts an make the world a better place. charitable arm of the billionaire ongoing series of events with entrepreneur’s vast array of Branson and Virgin Unite, entitled, “What we’re sharing is the idea companies, sparked Kelleher- “Leveraging Your Influence As a that any business has the ability 6 WWW.FAMILYOFFICEELITE.COM to focus on the planet and people in for inspirational gatherings of all and clothing company) president addition to profits,” she says, “and sorts—from dinner parties and James Curleigh, and president and it’s amazing to me how putting the retreats on the California coast, CEO of the NIKE Foundation, Maria right people together can affect to reunions in Morocco—while Eitel, to name but a few. change.” also working to match successful, passionate leaders in business, “Because of the notoriety of my Kelleher is actively assembling the politics, and Hollywood with the company, people take my call— guest list for her next event as we philanthropic charities that best suit married, single, it doesn’t matter,” speak. That means digging into her them. she says. “It’s really interesting. vast Rolodex of past clientele and They quickly realize this isn’t about thinking about those individuals Bringing people together for Kelleher International. It’s about who are in positions of power and something more than love has something more. So people don’t influence—while also thinking opened a world of possibilities for say, ‘Why did you call me?’ They say, about who might get along well Kelleher-Andrews, who until now ‘Wow, let’s do it!’” with whom. rarely had reason to contact clients she’d successfully matched in the That, in and of itself, is a lesson she “It’s still about matching people,” past, let alone to introduce them to tries to impart to other leaders. “If she says, “but I’m able to use my other clients, friends and associates you have the power to do some intuition, my ability to really get outside of the dating arena. good, and the desire to do some who someone is—all aspects good, you have more resources at of them, from personality to “Now it’s a whole different story. I your fingertips than you might have upbringing to career choices to the start with my database, and then I imagined,” she says. “And you’ll be position they’re in and what they’ve expand from there,” she says. “Once surprised at how responsive your accomplished—to inspire change.” I understand who some of the key network will be.” players are going to be at a given “The basic concept I’ve learned,” gathering, then I can go off the books So what does all this organizing and she continues, “is that if we change to invite a celebrity, a musician, “matchmaking for good” actually the businesses of the world, we will a politician, a VC… and it doesn’t yield? For one thing, the sharing of change the world. Because of the matter to me if they’re my client or if good ideas. business I’m in, I know many of the they’re married. I don’t want anyone top business leaders in the world, to feel that they can’t participate. One of her past invitees was Bert so I’m in a position to help bring It’s a huge movement of changing Jacobs, the co-founder of “Life is awareness and show by example business. It would be a disservice to Good,” the ubiquitous New England- how easy it is to make a significant say you have to be single and you based apparel manufacturer that contribution to this planet through have to be a client.” The response features uplifting sayings on its leveraging your influence in has been overwhelming. T-shirts, hats, and accessories. At whatever industry you are in.” one of the gatherings, Bert shared According to Branson’s blog, stories about sitting around the While the Necker Island gathering attendees at Kelleher-Andrews- dinner table in his youth, and how is perhaps the highest-profile organized events over the past the children in his family were event on her calendar, this woman two years have included Academy encouraged to share one good known for power-broker matches Award-winning actress Sally Field, thing that happened to them at now spends the vast majority of poet David Whyte, Lieutenant school each day. He took that her professional time bringing her Governor of California Gavin same idea and carried it into his A-list clientele and friends together Newsom, Levi’s (the American jeans company, asking his employees 7 FAMILY OFFICE ELITE MAGAZINE