Family Office as a Financial Education Mechanism in Brazil

Abstract

This article discusses the Family Office (FO) theme and describes how this organization promotes financial education for future heirs of Brazilian business families. FO is an organization formed by business families to manage and preserve their respective assets. Financial education is related to technical knowledge aimed at managing financial resources. This knowledge should concern the business family that aims to maintain its resources. The research was developed through semi-structured interviews using the thematic analysis technique. The sample includes a total of 19 people interviewed, linked to 10 FOs to whom they had convenient access. The research result identified two types of FO organizations: Single Family Offices (SFO) and Multi-Family Offices (MFO). Seven of the nine SFOs have programs for the financial education of heirs. Two of the five MFOs offer specialized financial education consultancies to their clients. The others manage financial resources. As a result, MFOs have more limited participation in the financial education of heirs. In contrast, SFOs, with more than 10 members, promote financial education, especially by hiring specialized consultants and offering targeted courses, that is, through training and development. The interviewees also emphasized that the knowledge they consider important to be developed for heirs is basic finance, balance sheet analysis, investment management, and family governance. In addition, the first generation of the business family usually has low schooling, while the second generation can already be considered highly educated. This characteristic may have contributed to education being one of the values preserved through the FO.