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<p>In the age of social media, a great deal of personal information about client family matters is now shared freely.</p>

Private Wealth Advice in the Social Media Era

If work is done well but no one tweets about it, is it still good?

We’ve all heard the question:  “If a tree falls in the forest and no one hears it, does it still make a sound?” This is often the start of entertaining philosophical discussions about perception, reality and all that surrounds those nebulous concepts.  Recently, I’ve been wondering about a corollary question:  If something is done well, but it’s kept quiet and not broadcast to the world at large, is the perception of its value reduced?  And, is the value of it actually reduced?

Not long ago, in the private wealth industry, it was a given that being discreet and keeping confidential about client work were important.  Not only were trust and estate lawyers bound by duties of confidentiality, but even those who didn’t have a professional duty took pains to make sure that their client’s private matters were just that - private.  Yet, in the age of social media, a great deal of personal information about client family matters is now shared freely, tweets and all.  Not only do family members regard their family’s identity and personal information as requiring less protection, (other than for the obvious identity theft and cybersecurity purposes), but also industry professionals have begun publicly naming their clients, or potential clients, as a way of wielding access and power.  Indiscreet information is shared over cocktail parties, and, more importantly, clients are used for professional purposes in ways that would have been unimaginable not so long ago. 

Today, many family business consultants find it a badge of honor to recommend a client for a speaking gig or media spread, especially if it’s focused on the work they’ve done together.  More and more wealth management firms sell their marketing events to clients through the allure of meeting other clients in similar situations.  These can certainly serve as important venues for peer-to peer networking, one that’s appreciated by clients.  At the same time, it’s an interesting business model, likely to accelerate profitability but at the risk of running into conflicts of interest.  In one instance, I brought in another firm in the industry to work together on a client matter.  The next time I called in the firm for a different matter, they presented, and charged for, an “expert” in the area—the very same client I had asked them to help with me, not long before. Again, an interesting business model (I don’t believe the “expert” received part of the fee), with ethical issues that are suspect, to say the least. 

But the one that I find most intriguing is the assumption today that by broadcasting the work you do, you’re making the statement that the work has been done well.  The correlation between the number of  “followers” and the quality of work is assumed to be high, despite little evidence to that effect.   In an extreme example, I received a call several years ago from someone who was interested in joining my practice.  He was quite enthusiastic about how we might work together and cited a lot of social media data, including the number of twitter followers he had.  There were many.  I then asked how many clients he had helped over the years - actual professional engagements on the matters in which he claimed expertise.  The answer was zero.  I worry about families who are seeking good advice that’s based on education, training and experience.  With all this  “tweeting” going on, literally or figuratively, how can someone who doesn’t have the kind of filter that develops after years of experience know whether the advice he receives will be good? 

On the other side of the coin is that eternal question about the perception of the quality of advice that’s kept confidential.  Does its silence to the outside world mean that it’s less valuable than everything else that’s blasted out?  Is a professional who keeps quiet about client identity and focuses more on the work to be done than advertising its merits at risk of having the work being perceived as lower down the quality scale?  It’s hard to know how things are seen, or “heard,” in this new era.  There are potentially very real consequences of that confusion.  Industry professionals and families seeking advice must look hard at those philosophical questions and, this time, not just for fun.

Patricia Angus, JD, MIA, TEP, is the founder and CEO of Angus Advisory Group LLC, a philanthropy and family governance consulting and educational firm.

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