Giving family office staff a route to report concerns about a senior person

Built on Chapter 6 of How to Start a Family Office by Richard C. Wilson.

An employee needs a way to raise a concern when the person involved is the employee's ordinary supervisor. Without that route, a billionaire family office can have an ethics policy that staff cannot use in its most difficult situation. The reporting process should anticipate that conflict.

Chapter 2 includes reporting issues to a compliance officer or board member within the ethics policy. I would make the alternative contact explicit and explain how an employee can reach that person. The route needs to work when the concern involves someone influential.

Identify a contact outside the ordinary reporting line

Choose an appropriate alternative through the office's governance process. The person should have authority to receive the concern and arrange the next step. A name listed only for appearance gives employees little practical protection.

Have counsel help design the procedure and address applicable obligations. The office should understand how concerns are handled before promising a process it cannot deliver.

Explain how the alternative contact is reached. Avoid making employees request permission from the very supervisor whose conduct they may need to report.

Describe the information an employee can provide

Ask for the facts the employee observed and any relevant records they are authorized to share. Distinguish direct observations from information heard from another person.

Do not require the employee to establish a legal conclusion or prove misconduct before raising a question. The recipient can arrange an appropriate assessment. Staff should not have to conduct their own investigation.

Provide a route for questions about the policy itself. An employee may be unsure whether a request is improper and need guidance before taking action.

Explain handling and confidentiality accurately

Tell employees how the concern will be received and who may need to become involved. Avoid promising absolute secrecy when the office cannot ensure it. Counsel should advise on the procedure and any communications required.

Limit access to people with an appropriate role. A concern involving a prominent relative should not become a broad office discussion. Privacy helps preserve a fair assessment of the facts.

Keep the employee's work responsibilities separate from the concern where appropriate. Have the relevant professionals address any protection or interim arrangements the situation requires.

Establish who decides the response

The person receiving the concern should know when to involve counsel or another qualified specialist. A family office executive may coordinate the process without being the right person to assess every allegation.

If the usual decision maker is involved, use the designated alternative authority. The procedure should identify that route before a difficult case arrives.

Preserve the distinction between receiving information and reaching a finding. A report deserves attention, but the office should avoid treating an allegation as an established fact or dismissing it based on the person's status.

Have the responsible professionals direct record handling. Employees should know not to alter relevant office records or circulate them casually. They should also know how to seek instructions if a record may be lost.

Avoid encouraging staff to obtain information they are not authorized to access. The office can arrange appropriate evidence collection through the people responsible for the assessment.

Keep a record of decisions made during the response. That record should be maintained under the appropriate confidentiality and retention arrangements.

Make the procedure credible in ordinary practice

Explain the route during onboarding and make the operative instructions available to staff. A policy hidden in an old handbook is difficult to use under pressure.

When a concern is raised, acknowledge it through the established process. Provide whatever follow-up is appropriate without disclosing information the employee should not receive.

If the process exposes a gap in authority or contact coverage, correct that gap. Employees should be able to use the same route consistently regardless of the senior person's relationship with the founder.

Questions and answers

Must a concern go through the employee's supervisor? The approved procedure should provide an alternative where the supervisor is involved or the ordinary route is unsuitable.

Should the employee investigate before reporting? They should provide known facts through the authorized process. Appropriate professionals should determine the assessment and evidence handling.

This page is general information, not legal advice. Family governance documents and dispute processes should be reviewed by a qualified attorney.