New Compensation Survey Released by McNally Capital, Botoff Consulting, Mack International Covers 152 Family Offices Representing Over $100 Billion in AUM
McNally Capital, Botoff Consulting, and Mack International are pleased to publish the results of their 2017/2018 Compensation Survey of Investment Professionals in Single Family Offices.
CHICAGO JANUARY 17, 2018 – McNally Capital, Botoff Consulting, and Mack International are pleased to publish the results of their 2017/2018 Compensation Survey of Investment Professionals in Single Family Offices. A total of 152 family offices participated in the survey, representing over $100 billion in assets under management (“AUM”). Data was reported for 303 investment professionals, and the survey findings represent family offices across six AUM tiers.
“This is one of the only, and certainly the most comprehensive, compensation studies published that focuses solely on single family office investment professionals,” said Linda Mack, President of Mack International. “As the prominence of single family offices continues to grow in the market, there is an increased need to understand competitive trends in compensation in order to successfully attract and retain the top talent needed to accomplish family objectives and ensure alignment.”
Beth Rahn, Vice President & Head of Family Capital at McNally Capital, said, “We continue to see a growing number of family offices investing directly and commanding a stronger market presence. This dynamic requires family offices to staff themselves accordingly, making the availability of best practices and competitive compensation data increasingly necessary.”
Trish Botoff, Managing Principal at Botoff Consulting, said, “The complexities of family offices require an acute level of knowledge with regard to benchmarking and compensation plan design. Family offices have become increasingly competitive for talent, and this survey offers families the data they need to ensure they are knowledgeable of those benchmarks.”
Survey findings include:
1. 92% of family offices participate in direct investing activity, with 86% of family offices managing direct investments internally versus using a third party advisor.
2. A majority of family offices utilize a balanced investment approach that focuses on both wealth preservation and growth. Over 25% of family offices take an aggressive investment approach that focuses on wealth growth.
3. Over 40% of family offices provided salary increases greater than 4%, which exceeds the national average of 3.1%
4. 55% of family offices use formalized incentive plans or a mix of both formalized and discretionary plans to determine annual incentives, reflecting an increasing trend toward more structured plans.
5. Generally, the higher the AUM, the greater the likelihood of some formalized structure in determining annual incentives.
6. Overall, more than 60% of family offices utilize some form of long-term incentives (“LTI”); 87% of family offices with more than $1 billion in AUM use LTI plans.
7. As reported, co-investment and carried interest are the most common LTI plans used; this suggests that families are using long-term incentives to create alignment with executives and investment staff.
For more information on the survey findings, please contact one of the survey sponsors.
About McNally Capital
Formed by the McNally family, who owned and operated Rand McNally & Company, McNally Capital is dedicated to upholding a 140+ year legacy as a family-owned and operated company. Today, McNally Capital is focused exclusively on Direct Family Capital through Direct Investing and Merchant Banking services. With an emphasis on partnership, we harness the financial, intellectual, and human capital of our family office ecosystem to build value for family office investors, management teams and operating companies. We maintain a private network of over 800 family offices with whom we collaborate to make and manage direct investments. For more information, please visit: http://www.mcnallycapital.com.
About Botoff Consulting
Botoff Consulting, LLC is an independent compensation consulting firm specializing in working with family offices, family business enterprises, foundations, and wealth management firms. The firm offers customized compensation and benefits consulting services for both executives and broad-based employee groups. Botoff Consulting was established in 2014, with a goal to bring better compensation data to the family office/investment firm market. For more information, please visit: http://www.botoffconsulting.com.
About Mack International
Mack International is the premier, boutique retained executive search and strategic management/human capital consulting firm serving national and international clients in the family office, family business enterprise and the wealth management industries on national and international basis. Founded in 2002, the firm has achieved an exceptional track record of success as evidenced by its unmatched industry expertise, in-depth market knowledge and unparalleled track record of success. 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. For more information, please visit: http://www.mackinternational.com.
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