The Public Relations Handbook

While we all deserve privacy, the term “private families” has another meaning: those possessing great fortunes and significant influence. What kind of fortunes are we talking about? Generally speaking, these families are believed to control more than 50 percent of the world’s wealth. Much is written about economic inequality as a social injustice. Private families’ measurable possessions and the power that comes with that wealth can foment anger and resentment, controversy and pushback. At the very least, the mere existence of super-wealthy families makes many people uncomfortable.

My priority in this chapter is not to pass judgment on such concentrations of wealth, but to focus on just one issue: effective public relations and communications practices for the wealthy and influential. Public relations is both a business and a mission of sorts, and private families present what are largely unexplored opportunities for people in that business.

Most of my own career has been in philanthropy as both a fundraiser and a member of family foundation boards. In these roles, I have seen firsthand that good communications should be integral to the lives of the wealthy, but often it is not. I have seen individual and family reputations ruined because of poor or nonexistent attention to public relations. In too many cases, wealthy families do not proactively tell their own stories and often let salacious public narratives define who they are and what values they have.

It’s been my experience that families that treat their wealth as if it were the assets of an enterprise or a well-run company have a higher probability of (a) not losing those assets and (b) having them fulfill the family’s goals. In my world, that’s called using financial capital. But there are two other essential forms of capital:

■Human: the skills, knowledge, and experiences of the families and their members.

■Social: the network of relationships that enables families to function effectively in society.

All three forms of capital—financial, human, and social—can be managed and enhanced. But they can also be destroyed by behavior that inflicts reputational damage.

Human beings love stories—aka gossip—about other human beings, especially about the rich and famous. That’s why wealthy people have always had to contend with the public’s insatiable curiosity about them. Modern technology has become a great enabler of this curiosity. The public craves trivia about the rich—who’s marrying (or divorcing) whom, what galas they attend and what they wear, and all the rest of it. There’s also the well-intentioned desire to know the stories behind their success, and maybe learn something useful.

MANAGING VISIBILITY

Often the wealth of a family is based on a successful enterprise established by a founding figure. Think of the riches that John D. Rockefeller created when he built Standard Oil, or the fortune that the “Pickle King,” H. J. Heinz, established with the food company that bears his name. Those families and others like them have become household names, and the founders’ descendants have often gone on to become public figures, whether as owners of sports teams, media companies, or entertainment platforms, or as aspiring politicians. John D.’s grandson Nelson Rockefeller was elected governor of New York four times and served as vice president of the United States for three years; H. J.’s grandson John Heinz was a US senator from Pennsylvania and a potential presidential candidate until his 1991 death in an airplane crash.

Many families whose wealth comes from a foundational business are now significant investors in others’ businesses, or bundle others’ assets to invest in tandem with them. Many families control more money than some countries do. Others achieve prominence by practicing philanthropy on local, national, and international scales. (Think of the contributions that the Bill and Melinda Gates Foundation has made to raising educational standards and improving world health, among other causes.) Many wield political or governmental power, again on levels from local to global, regardless of whether they hold office. (Think of the attention, both positive and negative, that the Koch brothers, Charles and David, have attracted by supporting libertarian politics and promoting the oil and gas industry.)

The visibility that comes along with these activities must be managed. Visibility can easily become notoriety.

Of course, many private families try to stay private. They avoid public activities and lead low-profile lives, even if their silent influence can be profound. They are all around us; every locality, region, and country has its own set of such people. For every wealthy family’s name we know, the evidence suggests there are many more we have never heard of. Even so, because wealth attracts curiosity, private families are not immune from the negative consequences of attention. This has always been the case, but the stakes are higher in today’s superheated social media environment, especially because the resentment about economic inequality continues to mount.

Visibility, desired or not, managed or not, is one of the chief communications challenges that private families face.

AN OUT-OF-SIGHT MARKET

What is special about the private family market? The size, worldwide reach, and economic clout of these families is considerable. Yet this market is not monolithic, but rather very fragmented—and, like an iceberg, much of it out of sight.

How do you deliver the communications support that private families need? And who does the actual work? Some private families have a public relations person on staff or through their family office, an organization that also handles everything from household management to vacation planning to bill paying. (I’ll come back to the subject of family offices later.) Other families depend on the PR departments of the companies they control or the sports teams they own. Some merely task a family member with the responsibility, regardless of qualifications.

Dealing with private families as a communications expert requires a great deal of innovation because, while established public relations methods still apply, new public relations protocols must be constantly invented in real time. That is the challenge—and the satisfaction—of getting in early on this relatively new field.

Private families make up a market in which every public relations discipline can be brought to bear: internal and external communications; crisis management; financial, media, community, and international relations; lobbying; political campaigning; event planning; staffing events; research; and much more. All the lessons in the other chapters in this handbook can be brought to bear with great effectiveness.

In this chapter, I will explore what I see as the challenges of bringing your communications professionalism to this fascinating market. Perhaps you are an employee or a principal of a public relations consulting firm. Perhaps you are an individual practitioner. Perhaps you want to be on a wealthy family’s staff. Whatever place you occupy, know that in this marketplace, where legal and financial advice were once the only services these families valued, communications is rising to take its rightful place.

THE ROLE OF FAMILY OFFICES

Let me return to the term “family office,” first to explain the special meaning it has in the context of family wealth, and then to explain how public relations professionals come into the picture.

The history of family offices goes back to the late nineteenth century. In what is believed to be the first instance, the Rockefellers decided they needed a private wealth-management advisory firm dedicated solely to their interests. Over time, many other families adopted the practice. But it was the 1980s boom in private family wealth that set off the real growth spurt. By 2020, there were an estimated three thousand family offices in the US, managing somewhere between $1 trillion and $1.2 trillion. According to Barron’s, the number of firms worldwide is now greater than ten thousand, and they manage upward of $4 trillion.

Family offices come in two flavors: single-family offices that work only for one wealthy clan, and multifamily offices that handle several of them. The services they offer vary from firm to firm and often change over time as clients recognize new challenges or decide on new goals. In general, though, the first and foremost task family offices perform is providing investment advice—they are wealth managers. Beyond that, they may handle a range of tasks, such as making travel arrangements for both business and pleasure, tax planning, handling the payroll for the family’s staff (sometimes the family office itself supplies the staff), property management, overseeing charitable contributions, and setting up trusts.

In highly sophisticated family offices, one of the most important functions is managing intergenerational relationships and the transfer of the family wealth down through the years. That might seem routine enough at first glance, but in real life it can present enormous challenges. It is normal, for example, for a family to become quite large by the time it reaches the fourth or fifth generation. As the number grows, individual inheritances and the corresponding influence may become smaller. Not small by the standards of the workaday world, perhaps, but small to someone who can’t understand why his or her share of a fortune that was once measured in hundreds of millions is now only a few million. That can be hard to accept for someone with great dreams of wealth and luxury.

And then there are always the family black sheep (yes, they do show up sooner or later) who squander their share of the inheritance and demand more. Managing the fights this inevitably sparks among children, parents, grandparents, siblings, cousins, and so on, is one of the biggest challenges some family offices must deal with—life issues, especially, such as overspending, reckless gambling, multiple divorces, alcoholism, or drug addiction, are variables leading to the disappearance of an inheritance.

Yet another frequent hot potato is managing family relations when a new generation comes along that wants to sell off the family business. The twenty-somethings may feel that too much of the wealth is tied up in tangible goods like factories, offices, or vehicle fleets and want to cash it in with a sale. That is exactly what happened when the Bancroft family, which owned Dow Jones and the Wall Street Journal, decided to sell it all to Rupert Murdoch in 2007 for $5 billion.

Sometimes the members of the younger generation want to get out because the nature of the family business offends their values. They believe the factories’ smokestacks spew out pollutants, for example, or the company’s labor policies seem exploitive, racist, or sexist. (More on this and the public relations challenges it presents later.) Whatever the motivation, the desire to get rid of the very business that has made the family’s fortune and perhaps also made the family name can come as a complete and unacceptable shock to parents and grandparents whose lives always revolved around the business. A fight inevitably ensues.

Another struggle may break out if the family member who runs the company decides to skip a generation or two in choosing a successor. Rarely if ever is the generation that is about to be passed over willing to stand by quietly. A variation of this conflict is when the person in charge decides no one in the family is worthy of the leadership mantle and wants to bring in an outsider as the new CEO.

Yet another kind of conflict may arise when the founding figure has grown old in the job but refuses to let go. That can be especially troubling when the creative genius that made him or her so successful long ago is not what’s needed to administer what is now a large, complex organization. As the irascible behavior of Henry Ford toward the end of his life demonstrates, a lot of bad decisions get made in such situations. It may be the second generation or perhaps the grandchildren who see the problem and seek to replace the aging boss, but the result is almost always a jarring struggle.

COMMUNICATIONS CHALLENGES

Managing the conflicts that these developments can create is a major family-office challenge. The greater the family wealth is and the better known the family name may be, the more likely it is that such internal conflicts will go public. That is where public relations professionals and communications experts become invaluable allies.

The media love it when rich people are at one another’s throats, of course. But beyond the risk of tabloid and social media exposure, there are usually serious consequences involved in these fights. If, for example, the company’s reputation is damaged by the bad publicity, uncertainty is sure to follow, workers may see their jobs jeopardized, stockholders may lose value, suppliers may lose business, local communities can lose tax revenues, and entities that have been the recipient of philanthropic donations can be harmed by association. Handling the media in such situations, so that the damage to the family name and the company’s reputation is minimized—or ideally, avoided altogether—is a job for communications professionals.

It’s not just external media relations that need skillful handling. Internal communications for the family and its company are just as important. There is nothing more upsetting for family members than realizing they’ve been kept in the dark about important developments. Same thing for employees of the organization. Maintaining clear lines of communication, creating a strong sense of openness and transparency, getting the right information into the right hands at the right time—that’s what public relations professionals can do. And that’s why they are so essential for family offices and their clients.

By the way, family offices may have communications needs of their own that require expert help. When a Philadelphia-based multifamily office with a “Who’s Who” list of clients decided that its wealth-management operations were too stodgy and needed an update, it was concerned that the changes would unsettle many of the families. It called in a major New York public relations firm to help explain the changes. The advice was to set up a carefully scheduled outreach program, including written materials and in-person meetings, to educate the families about the changes and ease them into the new structure. The program—and the changes—came off without a hitch.

LEARNING TO LIVE IN THE OPEN

That last example reinforces the point that public relations is a form of education. Teaching wealthy families how to function in a world in which the privacy they value is under attack is a key role for public relations professionals. Simply put, it is almost impossible in an age of social media to be rich and private. Understanding public relations and having an expert available to provide advice is essential. If you were going to lay out this argument to a potential client, it would go something like this.

The public has always had a fascination with the lifestyles of the rich and famous. Part of the appeal is no doubt fantasy—Maybe I’ll live like that one day, too!—and part of it is bias confirmation—See how spoiled and selfish they are! And there is always the schadenfreude when wealthy folks get into serious trouble.

This fascination has taken on a new political edge because of the rising concern over income inequality and its potential threat to democratic institutions. The Occupy Wall Street movement may have lost the energy and determination that once enabled it to take over part of Manhattan’s Financial District and capture national headlines. But the movement’s mantra (“We are the 99 percent”) conveyed a powerful, widely remembered message: that the top 1 percent—a relatively small number of families—controls a disproportionate share of the nation’s wealth. And so, even though the Occupy movement is no longer front-page news, the lesson it taught is now baked into the public’s mind. Even if you are just part of the top 10 percent, you may be prone to being vilified.

In short, with extreme wealth comes extreme attention. What’s more, in the era of social media there is no place to hide. Therefore, managing a wealthy family’s reputation and public image requires professional help. The old truism is right: if you don’t tell your story, somebody else is going to tell it for you.

FOLLOW THE MONEY

As I mentioned, one of the most common events that calls for the help of public relations practitioners is when a fight breaks out over the disposition of a private family’s fortune. For older families, that frequently happens when a new generation begins questioning the sources of the family’s wealth or demanding that it be redirected for social justice purposes. (This trend, by the way, is consistent with the reassessment of America’s past by people who believe the wrong historical figures have been honored, leading to the removal of statues of Confederate leaders such as Robert E. Lee and the renaming of institutions at many universities.)

One of the most publicized examples of such a family struggle has involved Abigail Disney, the granddaughter of Roy Disney, who was the cofounder along with his brother Walt of the movie studio that bears their name. The issue on which she has been most outspoken is pay equity within the Disney organization. Why, she has demanded to know, are employees at places like Disneyland so poorly paid, when the CEO’s compensation is measured in tens of millions a year? “There is nobody on Earth,” she has declared, “worth 500 times his median workers’ pay.” Not surprisingly, the Disney organization has pushed back with a vigorous defense of its pay policy.

Certainly, both sides have arguments to make. This may seem obvious to people who are accustomed to functioning in the public arena. But for wealthy folks with a habit of keeping out of the spotlight, it may be a matter of considerable discomfort. To echo my earlier statement, they must tell their part of the story, or the story will be defined only by one side.

It is vital, therefore, to reach out to potential clients in family conflicts with a well-prepared and convincing pitch to show how you can help them get their case across. And always remember that it’s not enough to tell clients that you get their side of the argument. You have to persuade them that you have the know-how and the contacts to get that argument into the right hands.

WORKING DIRECTLY WITH FAMILIES

If you are called upon, how do you work with a private family? First, you must know how the family has organized itself and what the hierarchy is. Maybe the founding figure still dominates; such people are sometimes very controlling and often try to run not just the enterprise they created, but also the lives of everyone around them. Maybe there has been an awkward transition of power from the founder to the second generation, and siblings are struggling with one another for ultimate control. In other cases, especially when the family wealth has been spread across multiple generations, there is little clarity or structure. No one is really in charge but everyone thinks he or she holds the reins. That can seriously muddy the communications waters.

Successful private families often treat their wealth just as they would corporate assets. When that is the case, you as a public relations professional need to deal with them just like a corporate client. Lead them toward a mission statement that encapsulates what they are all about. Treat their family name and reputation as a brand. Define the values that underlie the brand, and ensure that every public interaction supports that brand.

Remember that private families, no matter how they are organized, are families. And all families, wealthy and not, are unique, idiosyncratic collections of individuals who can squabble, feud, pursue separate agendas, compete with one another, and much more. They can fall apart as easily as they can pull together. Yes, that happens in corporate enterprises, too. But corporate hierarchies have a built-in chain of command that acts as an enforcement agent. This model won’t work in families whose hierarchies can be unspoken, informal, changeable—and are frequently ignored by the very people who most need structure in their lives.

All too often in private families, the members delude themselves that they are operating in a kind of democracy where every voice counts. But all too often, a dominating figure is actually the one who makes the decisions. Sometimes it’s perfectly clear who the authoritarian is—an assertive patriarch or a strong-willed matriarch. Sometimes it’s not so obvious—a member of the younger generation who quietly shapes the family’s course, thanks to a shrewder head and quicker tongue than anyone else. Sometimes it’s just a bully. In many cases, other family members will accept the situation. They may be intimidated, too disaffected from family affairs to care, or so busy with their own lives that they don’t have the time and energy to fight back.

Whoever the real decider(s) may be, you as a public relations specialist need to figure it out and act accordingly. Know where the real power lies.

STICK TO THE FUNDAMENTALS

Let me outline now what I see as the core principles of working with wealthy individuals and families. The first point is that the fundamentals of communications always apply, and they apply with particular relevance to this audience. Those fundamentals are as follows:

1.Listening. This is especially important with people who are accustomed to having their words heeded. It does not mean agreeing with everything they say—far from it. But it does mean giving them a chance to express themselves fully, without unnecessary interruptions or commentary. And it means not only listening to the text of what they say, but also cocking a sharp ear for the subtext. For example, does a seemingly mild-mannered criticism of a fellow family member actually express deep-seated anger and resentment?

2.Openness. Keep all channels of communication open and working. Whatever it takes, there must be free-flowing exchanges to the greatest extent possible. Be aware that your availability may have to be pretty much 24/7.

3.Authenticity. One thing at which the wealthy tend to excel is picking up on phoniness and insincerity—they get a lot of it. You need to be authentic in what you say and do, even if you risk irritating the client. In the long term, honest dealing will get you the respect you need for your advice and counsel to be accepted and acted on.

4.Patience. Self-explanatory, but let me add that it does not mean letting problems fester. As a professional, you know that timing is all important to people in the media—they live a life of constant deadlines. So when you are advising wealthy clients, sometimes you’ll need to help them understand that, in public relations, you cannot set the timetable unilaterally—reporters and editors are going to go ahead and file stories and broadcast reports to meet their own needs, not yours or the family’s. Haste makes waste, goes the old saying, but in the PR business, it’s often fast action that keeps a problem from getting out of hand.

One of the skills you’ll need to deploy in working with wealthy clients is explaining the realities of a situation in ways that instruct without insulting. Case in point: In an initial meeting with a potential client, a public relations professional was put on the defensive when the client declared it was pointless to deal with the media because of what he saw as their dishonesty and viciousness. The immediate cause of his anger was the fact that a friend of his, a fellow billionaire, was under attack in the press for some controversial forays into politics and public policy. Knowing the client was part owner of a major-league team, the public relations pro replied, “Look, politics is a contact sport. If you go out on that field, you’re going to get hit.” The client sighed and said, “Yeah, I guess you’re right,” and the conversation got back on track.

Another essential in dealing with a private family is getting to know the family story. How was its wealth amassed, what positives or negatives are associated with its creation, how has it been shared, and how has it affected family relationships? This should lead you to understand the family values and culture.

William Faulkner taught us that “the past is never dead—it’s not even past.” Understanding a private family’s past and how that has shaped its present is crucial in understanding its culture and how it will respond to your communications advice.

TAKEAWAYS

Despite the unique challenges of working for wealthy families, certain rules can guide you through the process.

1.Always stick to the fundamentals of communications—listening, openness, authenticity, and patience.

2.Get to know the family history; get to understand its culture.

3.Never forget that however great its wealth, it is still a family, where family dynamics still apply, only writ larger.

4.Treat the family brand as carefully and protectively as you would treat a corporate brand.

5.Pay strict attention to where the power lies—who the real family decider is.

6.Get buy-in on all public relations strategies you develop. Brainstorm ideas first to get input before final decisions are made.

7.Remember that internal communications among family members is just as important as external communications—sometimes even more important.