“No se trata solo de hacer crecer el dinero, sino de tomar decisiones que honren el pasado, sostengan el presente y proyecten el futuro del patrimonio familiar.”
When a family has consolidated his company and has begun to diversify outside the business – with financial investments, real estate, art, philanthropy or ventures – he needs a structured way of making decisions.
There enters the family office, as a professional vehicle to administer that heritage. But within the Family Office, the Investment Committee meets a key role: being the body that translates the family mission into concrete investment decisions, protecting the legacy and promoting intergenerational unit.
What is an investment committee?
It is a working group, made up of family members and external advisors, which is responsible for defining and supervising the family heritage investment strategy. It is the bridge between family values and financial technical efficiency.
It is not just about how much an investment yields, but for what it is invested, how the decision is made, and if that decision reflects the common objectives of the family.
Seven foundations for it to work well:
1. Clear Operation Agreement
The Committee must be established in writing:
- Who are its members (family, external, experts)?
- How are decisions (majority, unanimity, quality vote) make?
- How often does it meet (monthly, quarterly)?
- Who has the authority to execute decisions?
This governance framework prevents conflicts, accelerates decisions and gives legal certainty to all involved.
2. Family Heritage Mission
The committee must be guided by a clear purpose. The objective is to preserve capital, generate flow to support the family, invest in impact projects, or promote new generations of entrepreneurs?
Define the mission of heritage creates a frame of reference to evaluate investments, reject proposals that do not fit and align everyone’s expectations.
3. Minimum financial education
A good committee requires members who understand the basics of finance:
- What is an investment and how it differs from an expense.
- Risk, profitability and investment horizon.
- Diversification, liquidity and risk tolerance.
- How the performance of a portfolio is measured.
Promoting financial training among family members is an investment in themselves.
A business family not only manages business, also manages a legacy.
4. Investment Policy (IPS)
The investment policy statement (IPS) is the document that summarizes how, where and why the heritage is invested.
Must include:
- Concrete financial objectives (preservation, growth, cash flow).
- Acceptable risk profile (conservative, balanced, aggressive).
- Time horizon and liquidity needs.
- Allowed assets and restrictions (not invest in weapons, tobacco, etc.).
- Sustainability criteria or social impact (if applied).
- Key indicators to evaluate performance.
The IPS is the Committee’s compass. Without it, aimless decisions are made.
5. Supplier evaluation
A poor selection of banks, advisors or funds can dilute the performance of the heritage.
The committee must:
- Compare net yields against Benchmarks.
- Check if the charged commissions are reasonable.
- Evaluate whether the suppliers are aligned with the interests of the family or with their own.
This analysis must be done periodically and with clear metrics.
6. Consolidated and transparent information
To make good decisions, good information is needed.
The committee must receive reports:
- Clear, timely and complete.
- That include yields, costs, risks, projected cash flow.
- In visual and understandable formats for all members, even non -experts.
A single consolidated source avoids errors and facilitates dialogue.
7. Review and Continuous Improvement
The economy changes, family goals evolve and risks mutate.
The committee must:
- Meet regularly (minimum each quarter).
- Evaluate what worked and what not.
- Adjust the strategy if the conditions change.
- Document everything to ensure continuity in future generations.
The constant review avoids falling into inertia and strengthens family trust.
Having wealth without structure is like having a ship without a rudder.
A well -designed investment committee protects much more than money. Protect family harmony, encourages financial education, professionalizes decision making and ensures that the family’s legacy does not dissolve, but also flourish generation after generation.
About the author:
Twitter: @mariorizofiscal
The opinions expressed are only the responsibility of their authors and are completely independent of the position and the editorial line of Forbes Mexico.
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