Singapore's Diverse Family Office Landscape and Talent Dynamics
In light of the rapid increase in the number of single family offices in Singapore, there is a growing demand for professionals specializing in sustainability, client relationships, and investment advisory services. This surge in Singapore's family office sector is expected to continue in the foreseeable future.
According to government data, the number of single family offices in Singapore rose from 700 at the end of 2021 to 1,100 by the end of 2022. Additionally, as of mid-March this year, there were approximately 200 pending applications for single family offices seeking approval to establish operations in Singapore.
Stanley Teo, the Managing Director of Asset and Wealth Management, as well as Corporate and Investment Banking Practices at Profile Asia, an executive search consultancy, anticipates a substantial increase in demand for talent due to the expanding family office landscape. Notably, these family offices are not limited to Asia but also include families from Europe and the United States, resulting in a heightened need for professionals with relevant expertise.
The competition for talent is currently evident in areas such as client relationship management, compliance, and investment advisory, as highlighted by Prashant Tandon, Managing Director and CEO for Dubai at Lighthouse Canton, a wealth management firm. Tandon is part of a leadership team that serves non-resident Indians in various jurisdictions, including Singapore.
Another area of increasing importance is sustainability-related roles within family offices. Paddy Balfour, Executive Director at Acre, a specialized recruitment firm focusing on sustainability-related positions, pointed out that family offices are witnessing a rising demand in this area. This demand is driven by their inherent commitment to philanthropy, generational shifts, and a more sophisticated approach to impact investing.
The prominence of sustainability has grown significantly in recent years, with regulatory bodies worldwide, including those in Singapore, recommending the inclusion of ESG (Environmental, Social, and Governance) considerations in strategic decision-making processes, as noted by Tandon from Lighthouse Canton.
This sentiment is echoed by other experts, such as Manish Tibrewal, Co-founder of multi-family office Farro Capital, who emphasizes the need for individuals who can align a family office's overall mission and vision with its core values, as well as design and implement family governance, philanthropic initiatives, and other non-financial aspects.
The quest for talent is not an isolated concern limited to Singapore; it is a broader issue affecting the financial services industry in various global markets.
The imposition of government restrictions on immigration in response to the COVID-19 pandemic, both in Singapore and worldwide, though justified, has added complexity to talent acquisition, as observed by Prashant Tandon of Lighthouse Canton.
Many families seeking to establish family offices in international jurisdictions do so with the aim of diversifying their investments beyond their home territories and optimizing their tax efficiency.
"In Asia, much of the wealth has been generated within the last two generations, and families typically continue to hold onto the original businesses responsible for their wealth," remarked Mohit Ralhan, Global CEO and Managing Partner at TIW Capital Group. Conversely, in the United States and Europe, wealth accumulation has spanned multiple generations, often involving the sale or transformation of family businesses into financial assets.
As more initiatives are undertaken to reduce concentration risk through asset liquidation, the establishment of additional family offices in the region is expected to increase. Consequently, the development and expansion of family offices in Asia are still in their initial stages.
Over the past decade, assets under management (AUM) in Singapore have grown by more than three times. Notably, a significant portion of this incremental AUM, approximately two-thirds, has originated from overseas. This trend is likely to persist as more affluent families, particularly from China and India, choose to establish their offices in Singapore.
Even if further measures are introduced to promote local hiring and investment, it is improbable that Singapore's appeal as a preferred destination for family offices will diminish.
Varying Family Offices, Distinct Attributes
Senior government minister Tharman Shanmugharatnam revealed in early July that single family offices in Singapore that applied for and received tax incentives had a workforce of approximately 1,400 local residents and permanent residents by the end of June 2022. Notably, at least two-thirds of these employees earned more than S$5,000 ($3,791) per month.
While family offices share certain common characteristics, there is no universal model that fits all of them.
"Family offices, especially single-family offices, do not typically employ a large number of individuals. In most cases, a single-family office consists of around five people or so. Consequently, the individuals they hire are often highly experienced and possess strong skills in asset allocation across various asset classes," explained Teo from Profile Asia. "Depending on their growth trajectory, more established firms in Singapore may have specialists in fixed income, equity, and even real estate to oversee their portfolios. However, the primary objective is always to ensure a robust asset allocation and strategic capabilities."
In contrast, multiple family offices aim to expand their assets, requiring senior professionals who can increase assets under management (AUM). As a result, they often recruit talent from private banks or asset management firms. Teo further noted that these offices decide whether to establish their internal investment capabilities or outsource them based on their specific requirements.
Recognizing the growing demand for skilled expertise, the Singapore government is actively dedicating substantial resources to talent development, primarily through institutions like the Wealth Management Institute (WMI), as highlighted by Ralhan from TIW Capital.
WMI, backed by state-owned Temasek and GIC and supported by the Monetary Authority of Singapore, has seen over 1,200 enrollments in family office-related programs since 2020 and aims to reach 5,000 enrollments by 2025. Ralhan expressed confidence in the availability of talent and the direction of these efforts.
In addition to training, Singapore has established a robust ecosystem of capabilities to assist family offices, including trust companies, philanthropic organizations, and auxiliary service providers such as tax advisors, legal consultants, and technology platform providers. This development aligns with the broader shift in wealth management toward artificial intelligence, machine learning, and data analytics, as noted by Ralhan.
According to government data, the number of single family offices in Singapore rose from 700 at the end of 2021 to 1,100 by the end of 2022. Additionally, as of mid-March this year, there were approximately 200 pending applications for single family offices seeking approval to establish operations in Singapore.
Stanley Teo, the Managing Director of Asset and Wealth Management, as well as Corporate and Investment Banking Practices at Profile Asia, an executive search consultancy, anticipates a substantial increase in demand for talent due to the expanding family office landscape. Notably, these family offices are not limited to Asia but also include families from Europe and the United States, resulting in a heightened need for professionals with relevant expertise.
The competition for talent is currently evident in areas such as client relationship management, compliance, and investment advisory, as highlighted by Prashant Tandon, Managing Director and CEO for Dubai at Lighthouse Canton, a wealth management firm. Tandon is part of a leadership team that serves non-resident Indians in various jurisdictions, including Singapore.
Another area of increasing importance is sustainability-related roles within family offices. Paddy Balfour, Executive Director at Acre, a specialized recruitment firm focusing on sustainability-related positions, pointed out that family offices are witnessing a rising demand in this area. This demand is driven by their inherent commitment to philanthropy, generational shifts, and a more sophisticated approach to impact investing.
The prominence of sustainability has grown significantly in recent years, with regulatory bodies worldwide, including those in Singapore, recommending the inclusion of ESG (Environmental, Social, and Governance) considerations in strategic decision-making processes, as noted by Tandon from Lighthouse Canton.
This sentiment is echoed by other experts, such as Manish Tibrewal, Co-founder of multi-family office Farro Capital, who emphasizes the need for individuals who can align a family office's overall mission and vision with its core values, as well as design and implement family governance, philanthropic initiatives, and other non-financial aspects.
The quest for talent is not an isolated concern limited to Singapore; it is a broader issue affecting the financial services industry in various global markets.
The imposition of government restrictions on immigration in response to the COVID-19 pandemic, both in Singapore and worldwide, though justified, has added complexity to talent acquisition, as observed by Prashant Tandon of Lighthouse Canton.
Many families seeking to establish family offices in international jurisdictions do so with the aim of diversifying their investments beyond their home territories and optimizing their tax efficiency.
"In Asia, much of the wealth has been generated within the last two generations, and families typically continue to hold onto the original businesses responsible for their wealth," remarked Mohit Ralhan, Global CEO and Managing Partner at TIW Capital Group. Conversely, in the United States and Europe, wealth accumulation has spanned multiple generations, often involving the sale or transformation of family businesses into financial assets.
As more initiatives are undertaken to reduce concentration risk through asset liquidation, the establishment of additional family offices in the region is expected to increase. Consequently, the development and expansion of family offices in Asia are still in their initial stages.
Over the past decade, assets under management (AUM) in Singapore have grown by more than three times. Notably, a significant portion of this incremental AUM, approximately two-thirds, has originated from overseas. This trend is likely to persist as more affluent families, particularly from China and India, choose to establish their offices in Singapore.
Even if further measures are introduced to promote local hiring and investment, it is improbable that Singapore's appeal as a preferred destination for family offices will diminish.
Varying Family Offices, Distinct Attributes
Senior government minister Tharman Shanmugharatnam revealed in early July that single family offices in Singapore that applied for and received tax incentives had a workforce of approximately 1,400 local residents and permanent residents by the end of June 2022. Notably, at least two-thirds of these employees earned more than S$5,000 ($3,791) per month.
While family offices share certain common characteristics, there is no universal model that fits all of them.
"Family offices, especially single-family offices, do not typically employ a large number of individuals. In most cases, a single-family office consists of around five people or so. Consequently, the individuals they hire are often highly experienced and possess strong skills in asset allocation across various asset classes," explained Teo from Profile Asia. "Depending on their growth trajectory, more established firms in Singapore may have specialists in fixed income, equity, and even real estate to oversee their portfolios. However, the primary objective is always to ensure a robust asset allocation and strategic capabilities."
In contrast, multiple family offices aim to expand their assets, requiring senior professionals who can increase assets under management (AUM). As a result, they often recruit talent from private banks or asset management firms. Teo further noted that these offices decide whether to establish their internal investment capabilities or outsource them based on their specific requirements.
Recognizing the growing demand for skilled expertise, the Singapore government is actively dedicating substantial resources to talent development, primarily through institutions like the Wealth Management Institute (WMI), as highlighted by Ralhan from TIW Capital.
WMI, backed by state-owned Temasek and GIC and supported by the Monetary Authority of Singapore, has seen over 1,200 enrollments in family office-related programs since 2020 and aims to reach 5,000 enrollments by 2025. Ralhan expressed confidence in the availability of talent and the direction of these efforts.
In addition to training, Singapore has established a robust ecosystem of capabilities to assist family offices, including trust companies, philanthropic organizations, and auxiliary service providers such as tax advisors, legal consultants, and technology platform providers. This development aligns with the broader shift in wealth management toward artificial intelligence, machine learning, and data analytics, as noted by Ralhan.
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