Several months ago I was asked to speak at a family office conference on trust. Since that time, I have been asked to speak on this subject at other conferences.
We often take something for granted until we lose it. Many wealth holders’ trust in their advisors, bankers, attorneys, family office executives and wealth managers has been damaged over the last year. In researching these speeches, I spoke with one individual who discovered he had been deceived by one of his advisors for over a decade. He told me he terminated the relationship, but now wonders about his other advisors. He went on to tell me, “I don’t know if I even trust myself anymore.”
The Madoff, Stanford and other lessor known scandals, are having a huge impact on the affluent. The Reagan era slogan, “Trust, but verify” has become part of the current conversation. There is wisdom in this idea, no doubt. However, real, authentic trust takes “going the distance,” by both wealth holders and their advisors.
By “going the distance,” I am referring to the effort it takes to confront issues many often avoid. The wealthy and their advisors need to risk conversations about the “truth,” of what they feel and think about the “relationship.” In other words, broaching the subject of trust is the first necessary step to building, repairing or reconciling a breech. And, even if no overt breech occurred, there is a chink in the collective trust between the wealthy and advisors across the board.
Recently I participated in a roundtable discussion on this topic. Several bankers and other financial professionals described experiencing feeling a “distancing,” from their clients. One advisor said, “its as if some clients are suspicious of me, my firm and my intentions.”
Many wealth holders were passive in their relationships with advisors. The shifting economy has changed the game. My encouragement to affluent clients and their advisors is to apply effort toward collaboration.
Collaborative partnership removes passivity, creating positive inter-dependency leading to clarity, innovation and trust in relationship and portfolio.
