Being a trustee in today’s regulatory and financial environment
Environment brings with it many risks and challenges. Nowadays, a
The trustee must be able anticipate when and where the next will occur
You must be prepared for any challenges that may arise.
A holistic approach. Vicky Stables is the Client Director.
Private Client Services, three areas that trustees should be aware of
1. Being a trustee requires being flexible to change
A trustee has to face and adapt to change on an ongoing basis.
It could be market, regulatory or industry developments
Client and business requirements. Trustees must adapt to changing circumstances.
In today’s world, being a trustee is an important job
risk. These risks must not be dismissed.
Considered every time a trustee decision has been made. Professional
While trustees cannot see into future, they can see into the present.
They have a lot of information available to them. This is how you can bring this information to your attention.
Information in the decision-making processes allows the trustee to
Make better decisions to protect their business.
They are their clients, but also themselves.
Access to information is a key component of our ability to solve problems.
Parties can challenge trustees. Turn on your phone, and you’ll see the
world at your fingertips. This knowledge gives you the ability to
Compare financial performance and get multiple opinions
Parties – from amateur to seasoned expert – and observe the
Actions can have unimaginable consequences. The parties interested
They have never been more informed than they are today.
Transparency at the heart of trustee’s regulatory efforts
Obligations add another layer of risk and challenge.
Different situations can have dramatic variations in their circumstances.
Trustees may be faced with difficult decisions.
Sometimes this is because of unanticipated consequences or court orders
directions. A trustee must be able to show that it has
Prudence and consideration were used to act.
Comprehensive records are one of the best defenses for trustees
keeping. Documenting the background and reasoning behind a
The most important thing is the decision-making process
trustee can do this: describing the challenges and justifying why.
A particular decision can be crucial.
Second, solid policies and procedures provide the framework for
How decisions can they be made and the regulatory and business implications
Environment in which they were made.
Third, knowledge is key. Understanding what is
It is important to be aware of the implications for all parties.
Every decision and every action can be challenged, but trustees must ensure that they are valid.
able to show why they made that decision.
2. Being a trustee means keeping your eyes on the future.
The relationship between a trustee and a family office can last generations
Wealth builds relationships and businesses thrive.
Families grow. We are trustees and enter into client relationships with the
We believe that these relationships will be built over the long-term.
Trustees will assess the trust’s longevity from the beginning.
How can assets be best used to meet potential needs?
Beneficiaries may have expectations that are met now and in the future.
Future, taking into account competing demands
Different generations of the same family?
Often, the people responsible for settling funds in a trust are
It may be entrepreneurial in nature.
Wealth is the foundation of a family. They can decide to remain.
Participate in the trust as a beneficiary, or not. The chance to repeat
As they face the trustee, their successes might challenge them.
Consider whether the next entrepreneurial idea will work.
Success or failure can be the result.
Common considerations for trustees are “What could?”
Current or future beneficiaries are influenced by the decisions made in this
past?” “Could a trustee simply be seen as going along?”
With the demands and expectations of a material influencer?”
Although one person may have been successful, the wealth was not generated by him.
The trustee will still need consider whether the business idea is viable.
Current business idea does not stand up to the long-term prospect
trust and whether these decisions protect the
Future beneficiaries’ interests?
3. Trustee means acting in the best interests of the beneficiaries
Trustee’s best interests
Trustee decisions often involve more and have greater impact
More than one party. It can be very difficult, if it is not.
It is almost impossible to meet all the needs of all parties. A trustee
Needs to be able and able to apply impartial expertise.
How to manage conflict.
The risk-reward ratio terminology is often misused. But
What does this translate into for trustees? It’s not about getting.
The right amount of remuneration was paid for the job performed;
It goes far beyond that. It’s about making sure that decisions are made correctly
The right decisions are made for all beneficiaries.
While acknowledging that not all beneficiaries will see it that way,
A trustee should consider with every decision what is most likely
The results will be.
Another consideration is where conflicts are involved.
Trustees should not try to be everything to everyone
People’s and, when needed, must seek the expertise
Professional third parties like lawyers, accountants, and tax
experts. This can often mean spending some trust
Money can be expensive, but not having it can make it more costly if the uniformed
The decision has been made.
You don’t have to look hard to find well-known products.
Public Trustee v.
Prime examples are Cooper (1999) or B v Erinvale PTC Limited (202020).
Take a look at these examples.
This all adds to the cost of setting it up.
Maintaining and managing a trust. It can be difficult to manage a trust.
It can be expensive, and clients may not always appreciate the value.
Understand the steps involved in reaching a decision.
It can be a rewarding job to be a trustee.
Ability and the ability to help clients achieve their goals and provide support
Families and various charities. This brings us to the daily
Protecting the trust, the client, and the trustee is a challenge
All possible risks are minimized
It is essential that a client chooses the right trustee for his or her estate.
They believe they can have a long-lasting and trusted relationship with someone they trust.
And with whom they can have confidence that the decisions are made
With due care and consideration. There could be situations in which
The client may not get the results they hoped for.
But they can rest assured that these are the right decisions.
With their best interests at heart, and those of the wider community.
This article is intended as a general overview.
guide to the subject matter Expert advice should be sought
Learn more about your particular circumstances.