The human factor: How organizational psychologists can help to preserve and grow family wealth


A chief learning and development office can complement the role of a traditional family office.

Peter Kenter  • Canadian Family Offices

Important roles for a family office: lawyers, accountants, investment advisors, portfolio managers… organizational psychologists? Increasingly, enterprising families are appreciating the benefit of consulting an organizational psychologist to assist them with the human factor — helping family members work together, develop their talents, uphold their responsibilities and even plan for succession.

Crysalia Inc. is a chief learning and development office (CLDO) headquartered in Montreal. The CLDO differs from the family office in that it focuses on the journey the family and its members need to undertake to arrive at a desired outcome, essentially enhancing the traditional process families have undertaken for decades to achieve a sense of purpose.

Crysalia estimates that 92 per cent of enterprising families will materially impair their family wealth within three generations. How do they see organizational psychology making a difference?

“We look at the family structure, the roles and responsibilities, and the individuals involved and build the ‘winning conditions’ for the family organization to achieve its sense of purpose,” says Jean Phaneuf, an organizational psychologist and co-founder of Crysalia.

While family offices concentrate on financial capital, a CLDO will concentrate on leveraging human capital. That includes developing talent, recognizing individual skills, abilities, traits and aspirations and harnessing the value of cross-generational perspectives.

For Patricia Saputo, co-founder of Crysalia and senior family executive of her own family’s single-family office, discovering and developing the talents of family members and assigning optimal roles within the family enterprise is critical. That becomes even more important during family succession.

“Just as you create a list of assets at the business level, you can do the same for family members, and their associated attributes and create a balance sheet,” she says.

Phaneuf notes that negative behaviours are often efforts by individuals to protect themselves. When family members know themselves better, they can overcome these behaviours.

Saputo says she’s personally experienced moments when she also believed her “winning conditions” were under assault.

“At that point I want to regain control, but that effort may be pushing someone else out of their winning conditions,” she says. “Understanding the other person’s winning conditions allows everyone to contribute positively as a family. You learn to elevate each other and move forward as a group.”

But autonomy is also an essential precondition of success, says Phaneuf. It allows family members with entrepreneurial drive to be proactive and to innovate so they can continue to generate and preserve family wealth. However, this quality doesn’t come naturally to everyone.

“If you don’t encourage self-determination, only 10 to 20 per cent of family members will voice their views and express their needs and concerns,” he says. “You can lose the participation of family members who withdraw and conceal their feelings.”

Saputo notes that CLDOs and family offices need to develop common language so that they can work together to optimize family wellbeing and purpose. That way, the success of the family can permeate the operation of the family office.

The evolving philosophy of the family may even require the family office to adapt and redeploy some of the family’s assets in order to achieve their personal aspirations, just as their philanthropic focus may change according to the values of the next generation.

Done well, the alignment between the family office and the CLDO results in a situation where families understand the range of options open to them in growing their assets, their individual responsibilities, the responsibilities they may be inheriting, and what stewardship of family wealth may look like for the next generation.

“If you don’t invest in the wellbeing of your family organization, the family itself will lose value,” says Saputo. “Ultimately, financial success is achieved when we help each family member to go through the journey of their lives and concentrate on helping them to find happiness, fulfillment and meaning in the roles they play.”

The subject matter experts spoke at an online presentation on Leadership Succession in the Enterprising Family, presented by PBY Capital — a distributor working with portfolio management firms to offer unique investment strategies and education to institutional investors and enterprising families.