Private Wealth Is Evolving: What Changing Terminology Says About Today’s Clients
Are new terms like “Private Capital” and “Family Office” just updated labels — or do they reveal something deeper about how the private wealth industry is changing?
In this fireside chat, Richard Joynt, Head of Family Office at Highvern, and industry veteran Catherine Grum, Family Office Governance and Design Specialist, explore how shifts in language mirror shifts in client behaviour, purpose, and identity — and what this means for the industry’s future.
For most mature fiduciary and administration firms, there are three types of clients:
(1) individuals/families;
(2) corporates/institutions; and
(3) pools / collectives of investors.
For many years the first of these categories was neatly badged as “Private Wealth”, which is a fairly simple and clear description. However, in recent years fiduciary firms have started to use alternative phrases to describe this group of clients, such as “Family Office”, “Private Capital” and “Active Wealth”. Why is this happening, and does it really signify anything?
It does matter, and it signifies a change in the type of client that we are now seeing in the majority of our client caseload. The traditional wealthy client often wanted to use offshore structures for a core number of common reasons:
(1) to assist with preserving and enhancing accumulated wealth, whilst providing monies to family members for life events (healthcare, education, housing, business loans etc).
(2) to take advantage of the Resident Non-Domiciled provisions in the UK tax framework, or perhaps
(3) to allow an Intellectual Property asset to grow in value in an offshore rather than an onshore structure.
A common theme arising in most of these core scenarios was that the clients were at the more passive end of the scale. In that context the phrase “Private Wealth” gave a fairly correct impression of the relationship between Trustee firm and its client – we were helping a family preserve and enhance its accumulated wealth and facilitating ways in which that wealth could be useful to the family, now or in the future.
It is not that the industry did not have much more active clients as well – I have been in practice in Jersey since 1994 and have worked for a number of clients who could not have been remotely described as Passive. However, the change we have witnessed is more one of complexity, scale and sophistication on the part of our clients in the last 10-15 years. The modern trustee will spend comparatively much more time dealing with clients with high levels of wealth, who have strong investment conviction, a demand to see their assets grow rapidly, and a desire to be heavily involved in the growth of that wealth.
The modern trustee therefore funds themselves dealing with clients who are much more active, and who act in a much more institutional manner than their clients from previous decades. Many such clients have been executives of sophisticated institutions themselves – international fintech firms, Private Equity firms, Hedge Fund managers etc. It is not surprising that when it comes to managing their own money, they demand that institutional approach.
This had led to a real evolution in Trustee firms and “Private Wealth” just does not describe the demands that these clients place upon us. Sometimes it feels as though we are extension of their Family Office, so closely do we work with their employees. We feel as though we are dealing at an institutional level, negotiating for our share of our clients’ proceeds of an IPO. We feel as though we must have a good understanding of all the financial instruments available to our clients, how these are priced, and what the inherent risks and potential rewards might be. We feel as though we are a partner in their journey of multiplying their wealth and extending their network and influence, and that we can add value to their efforts by giving insights into how our other clients handle tough situations.
“Private Capital”, with its inference that Capital is being put actively to work is a more fitting description of the more complex work we now find ourselves doing. “Family office” with its inference of a close and enduring partnership between family and its financial executives also works well in situations where the offshore fiduciary is running a structure where they can accept direct instructions from clients. In that context “Private Wealth” is starting to feel old-fashioned and too simplistic a term, and whilst the description will not be confined to history any time soon, it is no surprise to find firms such as ours proudly re-defining themselves.
As Catherine Grum notes in the video, “A lot more clients have more complex needs, and so I think terms like Private Capital are starting to recognise that.”
These evolving labels aren’t just semantics—they’re a reflection of how clients see themselves, and how the industry must adapt to meet them where they are.
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