Family Offices

Family offices

As a trusted fiduciary, we provide family offices and wealthy families curated access to the full spectrum of BlackRock capabilities, with liquid and private market investment strategies across asset classes, risk management and technology solutions. BlackRock offers resources to help family office clients meet their long and short-term objectives.

How we serve family offices

We provide family office investors full access to the breadth and depth of BlackRock to help each client achieve their unique investment goals:

• Alpha generation/capital appreciation

• Wealth preservation for future generations

• Stable streams of income

• Tax loss harvesting

• Cash management

• Risk mitigation

• Direct investing

In the family audiocast series

In this episode, Maisie Hughes, Head of Family Offices at SpiderRock Advisors, discusses concentrated stock selection.

Understanding clients' emotions is crucial. Maisie explores strategies to align emotions with portfolio objectives. Tune in for insights on family office advising and more.

podcast /
podcast /
In the family – Episode 2
Episode description:

Our exploration delves into the nuanced realm of family office insights. Embark with us on this journey as we navigate the currents of innovation, transformation and the evolving landscape within family offices.

Investing strategies for family offices

With access to BlackRock’s extensive suite of investment strategies across asset classes, our dedicated family office team creates a tailored client experience built to address each client's unique objectives.

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Diversified alternatives

As family office investors look to expand beyond traditional allocations in search of alpha generation, such as capital appreciation and uncorrelated income streams, alternative strategies are playing an increasingly critical role in their portfolios.

At BlackRock we believe that the need for an approach to alternative investing that is scalable, disciplined, integrated, technology-enabled and transparent has never been greater. Blackrock alternatives platform is designed to deliver family offices outperformance across a range of investment solutions such as private equity, private credit, hedge funds, infrastructure and real estate.

Fixed income

Family offices seeking to achieve positive returns with historically lower risk than other asset classes are utilizing fixed income strategies within their broader portfolio.

With Rick Rieder as BlackRock’s Chief Investment Officer of Global Fixed Income, BlackRock helps family office investors navigate the entire fixed income spectrum - from taxable & tax-exempt, active & index, public to private, fundamental & systematic - to help deliver better outcomes, convenience, value and transparency for our clients.

Active equities

Family offices seeking resilient long-term capital appreciation and/or exposure to specific sectors in their diversified portfolio often look for investment opportunities across BlackRock’s extensive equity platform.

Our fundamental and systematic equity strategies offer family office investors curated access to global markets as well as key investment insights. BlackRock’s equity investors and researchers combine company-specific research, innovative proprietary modeling and industry analysis to provide clients with insights that aim to deliver consistent, differentiated outperformance.

Our fundamental active equity investment strategies leverage BlackRock’s resources to meet client demands for higher alpha and outcome-oriented strategies.
BlackRock’s systematic investment platform combines cutting-edge technology, scientific research and human insight in the relentless pursuit of investment performance.
Index investing strategies, including ETFs and direct index customization, can help reduce portfolio volatility, create liquidity sleeves and reduce costs.

Cash management

Family office investors need effective cash management solutions that consider anticipated liquidity needs, such as capital calls, personal expenditures, inflows from operating businesses, potential expenditures and liquidity events, while also offering the potential for an enhanced yield profile hedged against risk.

BlackRock offers investment strategies and vehicles such as money market accounts (MMAs), short duration strategies, ETFs and separately managed accounts (SMAs) to deliver on a family office’s individual liquidity needs.

Outsourced Chief Investment Officer (OCIO)

As family offices face in-house resource constraints and increasingly complex responsibilities, utilizing an outsourced investment team is a cost-effective and consistent solution from generation to generation.

At BlackRock, an outsourced chief investment officer (OCIO) serves as the investment arm for a family office, partnering to provide:

  • Extensive, custom asset allocation and proactive advice to meet the families' unique investment objectives
  • Cost-effective and tax-efficient access to investment strategies and resources
  • Access to a systematic and institutionally diversified private markets program
Dedicated CIO model
Our CIOs are aligned with specific client segments, helping them solve specific challenges.
Broad investment toolkit
We believe investing in today’s markets requires a full toolkit of investment capabilities, from active, index, factor to alternative—all of which BlackRock can provide.
Tax efficiency
Our Aperio platform provides customized strategies and tailored solutions that help optimize for after-tax returns.
Cost-effective partnership
We understand the dynamics of a family office and therefore serve as an extension of a client’s staff to help free up their time to focus on continuing to serve the family.

Tax planning

BlackRock understands that after-tax returns are a key investment consideration for family office clients.

Aperio by BlackRock offers personalized, tax-optimized, index-tracking equity SMAs that reflect the goals and values of each family office investor. For more than two decades, Aperio has been an innovator in after-tax performance optimization.

  • Market exposure: From standard indexes to blended benchmarks for custom exposure
  • Tax management: From custom levels of tax-loss harvesting to other tax economics techniques aiming to generate tax alpha
  • Values-aligned investing: From personal values to a perfectly aligned portfolio through granular tilts, exclusions, and shareholder engagement
  • Factor tilts: From traditional factors such as Value and Momentum to fully custom tilts
  • Risk management: From minimized tracking error to sophisticated volatility control

Calvin: Hey Mark, I just got an e-mail from a family foundation where they want to learn more about mission-aligned investing, but they don’t know where to start. Could we catch up over coffee?

Mark: Happy to.

Calvin: So we have a family foundation that wants to invest to support its mission. So, how does Aperio help with these types of investors?

Mark: Let me share a client story with you.

We worked with the board of a family foundation that included a father and his grown daughters. 

We started by sharing Aperio’s portfolio construction approach. We use a multi-factor optimization process seeking to match the performance of the client’s selected benchmark index, while aligning the portfolio more closely to the client’s values.

Then we had a conversation primarily to listen to the family. Imagine listening in on a father and his grown daughters talking about what they believe. There was a lot of agreement--but there were also some issues where they didn’t agree.

Calvin: It almost sounds like family therapy.

Mark: It can feel that way. The father later said that having that conversation with his daughters was one of the most meaningful conversations he’d ever had.

Calvin: What criteria did they end up applying to the family foundation’s portfolio?

Mark: They were very concerned with world peace issues, so they chose criteria including an exclusion of military weapons and a tilt toward companies that scored better on environment, corporate governance, diversity, human rights, and labor relations. We built a custom score for the client based on these client-selected criteria. All of these were criteria that the family chose themselves. 

Calvin: And when you say that you tilted the portfolio, what does that mean?

Mark: Let me show you. 

We create a score for each company within each index based on various factors and values, such as the client-selected criteria like we just discussed. Once that’s done, we make a score which can range from 0 to 100.

What we see here is the aggregated weight of companies in the benchmark within each scoring quintile. We also take the company scores and calculate the weighted average score of the benchmark as a whole. When we tilt a portfolio, we construct a portfolio that has a higher weighted average score than the benchmark—frequently about 20 percent higher score, although there’s a range depending on different aspects of a portfolio. 

This graph now shows a comparison of the weight in each scoring quintile for the portfolio compared to the benchmark. The portfolio construction process seeks to track the benchmark performance as closely as possible while meeting the client-selected criteria. You can see that the portfolio still has some low scoring companies since tilts don’t automatically exclude companies. But you can also see that the tilts tends to underweight the group of lower scoring companies and overweight the group of higher scoring companies.

Calvin: You said the tilt level is frequently 20 percent. So how much variation is there in the tilt level across accounts?

Mark: Our starting tilt level for many of our standard strategies is 20 percent but tilt levels will vary based on tax management and other issues within a specific client portfolio, depending on the criteria they select. When we’re creating a customized score, we can also customize the target tilt level. 

We treat the customized score as a factor in the portfolio construction process. For each increase in the tilt level based on the customized score, we predict a larger potential deviation from the benchmark index. This deviation is called tracking error. Our clients can use this concept to consider the tradeoff between tracking error and the intensity they want to apply for their own specific values and preferences. We call this the Social Efficient Frontier.

Calvin: What’s your current relationship with the foundation client. And how has the relationship evolved?

Mark: Our first conversations with this client were in 2007 and they implemented a portfolio for the family foundation that year. The family then added personal, taxable accounts using the same criteria where we also apply our tax loss harvesting capabilities.

Over the years, we’ve worked with the father as new issues emerged for him. He’s very concerned about climate change and chose to add a low carbon tilt to the portfolio.

A couple years ago, the father asked to have another Social Conversation. It had been such a meaningful experience with his daughters he wanted to do it again. So, we did. And they’re still a client today.

Calvin: Any significant changes out of that second Social Conversation?

Mark: They increased the relative importance of diversity within the scoring profile and added some additional exclusions, including private prisons and predatory lending. We look to implement the client’s evolving values over time and continuing conversations are important to do that.

Calvin: So, do you work with all your values-aligned clients at this level of detail?

Mark: We really work to right-size the conversation for the client, but yes, we’ll work with each of our clients to make sure they understand what we can and can’t do to better align their portfolio with their values or mission.

Calvin: That’s great. So let’s meet with this client and see how we can help customize their portfolio to better support its mission.

Mark: Thanks, we’d be happy to work together and help this client.



Aperio Group, LLC, provides this material for informational purposes only and for the sole use of the recipient. The information contained herein is provided with the understanding that we are not engaged in rendering legal, accounting, or tax services. We recommend that all investors seek out the services of competent professionals in these areas. The strategies and/or investments referenced may not be suitable for all investors, because the appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. None of the examples should be considered advice tailored to the needs of any specific investor or a recommendation to buy or sell any securities. The fees and expenses Aperio charges may be higher than the fees and expenses of other investment advisors and may offset profits. Additional information about the firm, and our fees and expenses, is included in our Form ADV.

Investing involves risk, including possible loss of principal. Asset allocation and diversification may not protect against market risk, loss of principal or volatility of returns. There is no guarantee that any investment strategy discussed herein will work under all market conditions. Many factors affect performance, including changes in market conditions and interest rates, as well as other economic, political, or financial developments.

You should not assume that investment decisions we make in the future will be profitable or will equal the investment performance of the past. With respect to the description of any investment strategies, simulations, or investment recommendations, we cannot provide any assurances that they will perform as expected and as described in our materials. Past performance is not indicative of future results.

Indexes represent unmanaged groups of securities. Investing directly in an index is not possible. Past performance is not indicative of future performance.

Aperio Social Scores

Aperio assembles data from ESG (environmental, social, and governance) data vendors and other organizations, generally on an annual basis. This data is used to score companies on a wide range of ESG topics and is the basis for creating values-aligned portfolios. Data Elements are combined into preconfigured, standard Aperio Strategy and Tilt options and are also used to create customized, client-specific scoring profiles. The output from these profiles is generally referred to as “Social Scores” or “ESG Scores.”

To calculate Aperio Social Scores, Data Elements are evaluated (and quantified if needed), z-scored (statistically compared to the average value of other companies), and combined based on assigned weights into issue area Component Scores. Companies have multiple scores, with a different score for each component. Component Scores are aggregated at profile-assigned weights and are used to calculate Company Social Scores. Company scores are calculated across the entire Aperio universe and range from 0 to 100. Higher Company Social Scores reflect a “better” company and lower scores represent a “worse” company, based on the criteria being evaluated. When used as a tilt in the construction of portfolios, higher scores can result in an overweighting of companies and lower scores can result in an underweighting of companies. Strategy scores consist of the weighted average of the relevant Component Scores for each company. Each strategy—whether a standard strategy or client-specific option—generates a different set of company scores. These strategy-specific scores are usually referred to by their strategy name, such as “DEI Score,” “Aperio SRI Score,” etc.

We are happy to provide further details on how Aperio Social Scores are compiled and used.

Sources of Data

Aperio sources of data include MSCI ESG Research, ISS ESG, Bloomberg, GeoPhy. other data providers as relevant, and industry classifications (usually GICS® classifications). In addition, for certain Data Elements, Aperio sources information from other sources, including advocacy organizations.

Each of these data sources relies on a number of original sources for its data gathering. Three primary sources for data gathering are:

Mandatory company disclosures: In certain cases, companies must comply with regulatory requirements for the disclosure of information. This kind of information can range from financial information to information the US Environmental Protection Agency requires company facilities to disclose. The advantage of this information is that it is comprehensive across the universe of companies. Unfortunately, in many issue areas, no mandatory disclosure applies.

Voluntary company disclosures: Much of the information available is voluntarily disclosed by companies, often in corporate sustainability reports or in sustainability or responsibility sections of their websites. This information can be more difficult to incorporate into evaluations and ratings because all companies do not disclose all information, and even when they disclose similar issues, companies are not consistent in how they do so.

Third-party information: In certain instances, third parties may have information about a company that does not rely on the information disclosed by the company. For instance, a regulatory agency that fines a company has that information independent of any disclosures by the company.

Data that Aperio receives from its vendors and other information sources may include metrics constructed as a combination of these concepts. For instance, there is mandatory disclosure of certain kinds of international operations, including registered subsidiaries. When this information is combined with evaluations of countries’ political and civil liberties provided by a nongovernmental organization (NGO), we have a hybrid Data Element. In another example, we use ratings by the Human Rights Campaign (HRC) as an indication of a company’s approach to sexual-orientation issues. HRC gathers information from companies, including by conducting surveys (voluntary disclosure), and then scores the companies. So, this is a combination of voluntary disclosure and evaluation.

NOTE: When assembling data into Aperio scores, Aperio determines how to score missing data based on the reason and context for the missing Data Element value. When the Data Element is based on voluntary disclosure and the data vendor sought to gather the Data Element from the company, but the element is null, the company will receive the lowest available score. When the Data Element was not researched by the vendor because it is not relevant to the company’s industry, and Aperio agrees it is not relevant, then the company is generally assigned the highest possible score. When the vendor did not research the Data Element for the company based on its not being relevant, but Aperio disagrees with this assessment, the company is generally assigned an average score for the sector.

Data Limitations & Update Frequency

Aperio generally updates its ESG data for the Values-Alignment Menu annually. Data Elements may be updated during the year as our data providers receive new data from either the company or publicly available sources, and this will not be captured in our processes until Aperio’s next annual data update. Aperio generally updates all exclusions and scoring profiles annually, usually during the first calendar quarter. As accounts are rebalanced, the updated data will be incorporated, usually during the second calendar quarter.

Because the data sets are not updated in real time, there may be a lag between a change at the company and when the change flows into the data set, and again when it flows into the portfolio during a rebalance. Aperio endeavors to handle all updates consistently and does not override the approved, vendor-/source-provided data sets.

Aperio is dependent upon data and information that may be incomplete, inaccurate, or unavailable, which could adversely affect the assessment of companies based on ESG factors. Aperio cannot guarantee the accuracy of the data disclosed by companies or the estimates made by third-party vendors such as MSCI when data are missing. As a result, Aperio’s Social Scores are based on information with inherent limitations. Scores should be viewed solely as directional, and their accuracy is not guaranteed.

Portfolio Management Implementation Process

The Aperio Portfolio Management team uses data from the Component Scoring described above for the investible universe and integrates the data into the relevant strategies as indicated by our clients’ indicated investment guidelines. ESG strategies, tilts, and exclusions alter Aperio’s ability to track a portfolio’s benchmark. The forecasted deviation is measured using tracking error calculated by the MSCI Barra risk model. This deviation can be significant.

Opinions and estimates offered constitute our judgment and are subject to change without notice, as are statements of financial market trends, which are based on current market conditions. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. You should consult your tax or legal advisor regarding such matters.

This material may contain “forward-looking” information that is not purely historical in nature. Such information may include, among other things, projections, forecasts, estimates of yields or returns, and proposed or expected portfolio composition. No representation is made that the performance presented will be achieved by any asset allocation or investment, or that every assumption made in achieving, calculating or presenting either the forward-looking information or the historical performance information herein has been considered or stated in preparing this material. Any changes to assumptions that may have been made in preparing this material could have a material impact on the investment returns that are presented herein by way of example.

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offeror solicitation to buy or sell any securities or to adopt any investment strategy. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. There is no guarantee that any of these views will come to pass. BlackRock does not guarantee the suitability or potential value of any particular investment. Reliance upon information in this material is at the sole discretion of the reader. Past performance is not indicative of future results.

Investing involves risk, including possible loss of principal. Diversification does not assure a profit nor does it protect against loss of principal.

Equity and fixed income characteristics and allocations are for informational purposes only. Such characteristics and allocations are not intended to be predictions or projections of any portfolio's performance.

The information contained in this presentation is proprietary and confidential and may contain commercial or financial information, trade secrets and/or intellectual property of BlackRock. If this information is provided to an entity or agency that has, or is subject to, open records, open meetings, “freedom of information”, “sunshine” laws, rules, regulations or policies or similar or related laws, rules, regulations or policies that require, do or may permit disclosure of any portion of this information to any other person or entity to which it was provided by BlackRock (collectively, “Disclosure Laws”), BlackRock hereby asserts any and all available exemption, exception, procedures, rights to prior consultation or other protection from disclosure which may be available to it under applicable Disclosure Laws.

In Canada, this material is intended for institutional investors, is for educational purposes only, does not constitute investment advice and should not be construed as a solicitation or offering of units of any fund or other security in any jurisdiction.

© 2024 BlackRock, Inc. All rights reserved. BlackRock® is a registered trademark of BlackRock, Inc., or its subsidiaries in the United States and elsewhere. All other trademarks are those of their respective owners.

Aperio: Aligning investments with values

Our experts at Aperio partnered with a family foundation that was looking to better align their investments with their values. The outcome? A tailored portfolio that aligns closely with the foundation’s mission and still achieves their investment objectives.

Join us at an upcoming family office event

We frequently organize calls, workshops, webcasts, roundtables and larger conferences to allow family office professionals to engage with our investment leaders and each other and discuss what is impacting portfolio decisions across the industry.
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Our family office team

With regional coverage across the country, the team offers tailored expertise centered on unique family needs.
Key stats about BlackRock’s family offices team.
Lili Forouraghi, CFA
Head of Family Offices, Healthcare, Endowments and Foundations and Official Institutions
Lili Forouraghi, CFA, Managing Director, is Head of BlackRock's Family Office, Healthcare, Endowments and Foundations and Official Institutions effort for the U.S., which provides investment management services, risk management and advisory solutions to these client segments.
Lyle Ross
Director, Southeast
Christopher W. Tatlock, CFA
Director, Northeast

Contact our dedicated family office team

Get in touch with BlackRock to discover how we partner with family offices and wealthy families, delivering institutional investment and risk management solutions across asset classes.
Contact our dedicated family office team

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Common questions

  • BlackRock is a fiduciary to family office clients. Our team offers institutionally-scaled investment services that range from single mandates to multi-asset solutions, tailored portfolio analytics leveraging Aladdin technology and market insights provided through research reports and investment forums. The Client Insight Unit (CIU) provides family office investors with multi-asset portfolio construction expertise, focusing on solutions comprising both public and private markets.

  • BlackRock's Americas Institutional Business has hundreds of family office clients and US$16bn in AUM (as of December 2022).

  • Yes, the BlackRock Educational Academy was launched in 2013 with the objective of facilitating the training needs of BlackRock’s institutional clients. Learn more about the BlackRock Educational Academy.

  • We offer a variety of events – including calls, workshops, forums and conferences – that allow family office professionals to engage in debate around topical issues and to make better informed investment decisions. Contact us to learn about events for family offices.

  • BlackRock’s scale is its key competitive advantage - it allows access to a plethora of information and insights that enable unrivaled risk management. Our Aladdin® platform combines sophisticated risk analytics with comprehensive portfolio management, trading and operations tools to power informed decision-making and effective risk management.

  • We have an extensive, US$326B alternatives platform (as of December 2022) that seeks to deliver outperformance with true partnership. We offer family office clients access to high-quality opportunities across real estate, infrastructure, private equity, credit, hedge funds and multi-alternative solutions. Global reach across private and public markets powers our sourcing, and industry-leading technology delivers improved transparency on investments.

  • Our purpose is to help more and more people experience financial well-being. In pursuit of this, we have embedded a focus on long-term sustainability across the entirety of our business. From integrating environmental, social and governance (ESG) practices into our investment processes to creating positive social impact by serving communities, we are dedicated to helping clients, employees, shareholders and communities achieve long-term, financial well-being.

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