In wealth management or family office services, clients and advisors frequently encounter events that impact needs and services.  These catalysts may prompt a client to initiate, add, change, or discard advisory services. Catalysts may be predictable and planned, or they may occur seemingly without warning. Catalysts may also be relatively minor, such as switching to a new relationship manager, or highly significant, such as the death of a family leader or a major liquidity event.  Being able to identify and respond appropriately to the common catalysts for families requires resilience, skills, and expertise on the part of both the client and the advisory team.

The UHNW Institute’s Integrated Family Wealth Management Initiative identifies four major categories of catalysts as the first step in the progression connecting client families with advisory services:  

• External or environmental catalysts: These are the economic, political, governmental, judicial, health, and other situational events that impact the client and/or the advisory team. Examples include the COVID-19 pandemic or a major shift in executive or legislative actions by a government.
• Family catalysts: These include the various entrances or exits of members of the family (birth, marriage, divorce, death), changes in residency, generational transitions affecting leadership or governance, ownership changes, a shift in values or goals, health events such as disability or major illness, or a new focus on learning or education within the family which requires effective response by the advisory team.
• Advisory catalysts:  These include changes or limitations in service quality or delivery by individual advisors or the team; firm-level changes impacting service delivery or client satisfaction, such as leadership changes or policy decisions about service offerings; prospecting by new advisors that draw a family away to a new firm; or regulatory, jurisdictional, legal, or tax changes imposed upon the firm which impact client services.
• Wealth catalysts: Bridging the client family and their advisors are catalysts in the wealth itself, such as a liquidity event from the sale, merger, transformation, or loss of a business; significant investment gains, losses, or fraud; inheritance significant enough to require alterations in financial services; cybersecurity and other risk events; infusion or loss of philanthropic assets; changes to trusts or beneficiaries; or a significant change in the types of assets owned.

Understanding the type, number, scope, and timing of catalysts helps predict their impact on the needs of the client (as defined by the Ten Domains of Family Wealth) and therefore the services that will be required to manage those needs.