Family Business Audiocast | Episode 63 | Amy Griman

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R. Adam Smith: [Intro] Welcome to the Family Business Audiocast on LinkedIn. I am R. Adam Smith, creator of this audiocast series. As an entrepreneur, investor, founder, investment banker, and board leader the last 25 years, I'm fortunate for my many experiences within the family firm industry. A brief comment on why I created this broadcast. 

R. Adam Smith: Private companies are a passion of mine, having grown up in a family of entrepreneurs, and having engaged for two decades in deals, strategic transformations, investments, and boards within an array of fascinating family enterprises, family firms, and family offices. I founded this series to offer a useful platform for listeners to hear from veterans, academics, and leaders in the vast family firm ecosystem. Whether you're a family business owner, building, running, or advising a family office, or just expanding your family office activities, I hope these conversations are useful and enlightening. And now it's time to turn our attention to our accomplished guests on today's episode. 

R. Adam Smith: [01:00] I'm pleased to be here today with Amy Griman, who is a global family office expert, governance expert, CEO and founder of Delta Creative Group, and formerly global president of the BMO Family Office. Amy, great to have you today. 

Amy Griman: Hi Adam. Wonderful to be here. Thanks for having me. 

R. Adam Smith: So, we'll talk a bit about Amy, who's one of the most experienced voices in the ultra-high-net-worth governance and trust and enterprise space. She has spent more than 30 years at the center of wealth law and family systems, serving some of the world's most complex families through moments of succession, liquidity, conflict, and reinvention. As former global president of BMO Family Office and CEO of BMO Delaware Trust, she oversaw approximately 80 billion in client assets, operating at the intersection of regulators, boards, advisors, and family principals, and, of course, the enterprise structures and lives of the family offices she worked with. 

R. Adam Smith: [02:00] But her work has always been something a bit deeper than capital. In fact, earlier in her career within trust and estate planning, she focused on the most sophisticated plans and their failures and success, focusing on tax law or investment strategy and also thinking about the softer elements of the family office and family enterprise. 

R. Adam Smith: [03:00] Over time, Amy was brought into some of the most delicate situations within these family enterprise organizations, including succession strains and family fractions and governance breakdowns. Today, through her group, Delta Creative, she helps families and family offices address what she calls the readiness gap as a private advisor. This is the space between technicality of sound structures and then, of course, the softer power and emotional intelligence in the family offices, including the human capital, cultural, and governance side. So, very, very happy to have her on the podcast. Amy, why don't we just talk a bit about Delta Creative Group a bit before we jump into the podcast agenda? 

Amy Griman: Yes, happy to. Delta Creative is a is a fairly new business and venture for me and it's really born out of these years of working with families and observing places where things just didn't work, despite great planning, despite wonderful advice, despite incredible success, there were still gaps even among the most sophisticated families. 

Amy Griman: That's been something that's always puzzled me, and I've always felt that as an advisor and a leader in the industry, we could do better. We should do better to help clients steward their wealth and preserve that for long term. So Delta Creative Group was really born out of a time when I was thinking about really impact in the industry and my next steps, and I kept coming back to the fact that I've seen this happen and I've been involved with families, ofttimes trying to either resolve those issues or ameliorate the impact. That's where I'm spending my time and focus now, trying to get ahead of those things and or help families once there are some cracks in the foundation. 

R. Adam Smith: [04:00] Yeah, we've had an amazing run of your colleagues in the industry within the family office and family enterprise space, covering especially some of the softer elements, which is really essential to address and to think about and talk about for our audience, not just the money and the wealth and the hard power. We'll talk a bit about your journey I think first and the trust system. 

R. Adam Smith: [05:00] You have worked not just in wealth management but also in trust law. Earlier with me, you noted you had been inside some of these more complicated trust and estate administrations, seeing how some of the technical flaws can be important and be either set up incorrectly or need to be readdressed and be continuously revised and on the ball, continuously revised. Can you talk about some of that here and just about the preparation process and being on the ball with the trust structures, and then we'll bring that into the human side? 

Amy Griman: Absolutely. Yes. So, coming out of law school, everything seems very organized and technical, right? A, B, C, D, you do these things. And when I started as a young trust officer, I spent my time in estate settlement. So I was working with families of all sizes to settle the estate where the bank was named as executor or trustee. 

Amy Griman: And that's where I really began to understand how all of the technical, the drafting, the estate plan, and the administration all came together. And I just constantly saw gaps, both gaps in the planning, which is one topic and probably not one I'm as qualified to talk about since I'm not a planner, but more importantly, gaps in just preparation and in the way the plan was administered over time. So by the time it got to my desk, there were issues. 

Amy Griman: [06:00] And the other thing that popped up is how the families were not ready to have those kind of conversations or to do the things necessary to move through that transition. Lots of family discord, lots of illegitimacy around the decisions in the plan. I was thrown into that fairly early in my career and really learned intimately how all of those things come together at the moment the plan comes to fruition and things start to happen. And I learned a lot about the technical side, and I'm still say that I have a sixth sense today about being able to look at a situation and have an ability to see where there might be weaknesses or gaps. 

Amy Griman: [07:00] It also taught me, I was really thrown in to just having to manage the emotions, the human and relational side of that, which there's a lot of great stories about that and a lot of learning about families, communications, preparation, which sort of all leads to that conversation around the readiness gap. 

Amy Griman: You know, I worked with wonderful attorneys, these are fabulous, really smart people, and it wasn't so much the plans, it was just how they were carried out over time. And the combination of those things could really make or break the legitimacy of the estate plan and quite frankly distract or disrupt the continuity of the family wealth and the goals that the wealth creator had. 

R. Adam Smith: [08:00] Yeah. From my perspective, this readiness becomes, of course with my background, emerges in mergers and acquisitions and private deal making, especially inflection points for the main operating company. I'm sure you've worked around the trusts and the governance and the controls and preparation for M&A or recapitalizations. This is the most important inflection point from a financial perspective because that's where the money will be made and flow through the family and the organization. If you could share more on the readiness gap, that's super interesting and super important. You seem to have four kind of core questions that relate to these ultra-high-net-worth families creating sophisticated plans and executing them, and maybe also talk about how that execution is best performed in terms of the internal resources of the family office versus the external resources of the lawyers and the law firms. 

Amy Griman: Yes. It comes to whether it's a transaction and being ready for day two or some other transition, right, that would happen within families of wealth, but particularly when there's a transaction, there's a date, there's an event. And I think making sure that stakeholders are really prepared to execute, I think there's something very exciting and glamorous about that event, but being ready for the event requires a different conversation. 

Amy Griman: [09:00] And I've seen many times where they're not quite ready, or they don't understand what happens day two, which is not about the deal or the transaction, it's about life after that transaction. And the more family members you have involved, or the larger the impact of that transaction, the more important that question is. And I've seen time and time again, whether it was someone passing away and a transition of leadership, or an event such as a sale of a business or an asset, the question is really not asked, or it's asked pretty perfunctorily as opposed to from a real place of readiness for those individuals. 

R. Adam Smith: [10:00] What is the decision architecture though within the large family offices? Can we talk about between the board versus the charter versus the council and some of the structures we see discussed by the Ultra High Net Worth Institute and Cambridge and, of course, others like Christina Wing, Richard Wolkowitz, IMD, Peter Vogel. There are so many resources out there, but it seems like there's key areas that are essential to address, but there's different opinions of their relative importance. So, is that relative importance more absolute or more more relative? 

Amy Griman: Yeah, that's a really good question. I think it depends on the family and their structure. The more complex the structure, you would think the more clear it would be. If the decision-making structure is sound within a family office, which could be through a board, could be through a family council, or in a smaller office, it could be through an individual. Whatever that case may be, the readiness gap often happens because it isn't clear who's making that decision or how that process will work. 

Amy Griman: [11:00] So, based on all of the work of esteemed colleagues that you've just mentioned, the design of that office I think is critical. And that governance and that structure has to be part of the process for that transition. And it has to be honored. Sometimes, I have seen where those structures exist, again, I don't want to say rubber stamp, that's too strong of a word, but I'm not sure they've really been given their due process, if you will, in that. 

Amy Griman: So I do think the board, the family council, whoever is making that decision, being prepared to make the decision, which means you're having conversations, there is education, there's knowledge about how those decisions are going to be made before the transaction even comes about, because the transaction could happen quickly, or it could move quickly once in motion. 

Amy Griman: [12:00] What I've seen, and I've seen it across the spectrum, honor those systems, and those systems often need to be reviewed and stress-tested for situations. That's another area where I've worked with families over the last several years where there is a governance structure, there is a decision-making framework, but it's not really been stress-tested. So that's another key question, is that governance structure resilient, is it ready, and is it regularly reviewed based on the growth and needs of the family and the family enterprise? 

R. Adam Smith: [13:00] I remember talking with Richard Wolkowitz and also Jim Grubman on some of these decision-making mechanisms and council mechanisms earlier, and around the underinvestment in the decision-making architecture. So, maybe just a bit more on on this issue of what is the best way for the larger families to keep a consistent process involved to modernize and institutionalize and improve and enhance and test and stress test these decision-making processes again, relative to the internal resources and human capital and expertise versus the external expertise? And that's also relevant to, let's say, what is the lawyer's role externally, law firm's role, what is their fiduciary duty versus what is the fiduciary duty of the family office itself. So, that's another interesting element of distinction. How to keep on that, who is responsible for that, and how often do these communications have to occur and keep it fresh? 

Amy Griman: Good question. There has to be an operating rhythm and a cadence around that. I think communication, family meetings, however that is set up, is really the key. What I've seen is there is a really strong appointed either council, individual, committee that is responsible for that stress testing and for the governance. I believe that within family enterprise with infrastructure and with commitment to that infrastructure, that is where the responsibility lies. 

Amy Griman: [14:00] To make sure, one, that they're meeting their charter and their mandate. Two, they're having the communications with the board. And three, that a broader and transparent communication pattern is available to the rest of the family. Certainly, the larger a family is, the more households and individuals, that communication is often where the gap happens. Maybe there's wonderful adherence and decision making in those leadership roles, but to really be certain that that governance and the duty of the leaders, and honoring their mandates, that communication, which could be family meetings, it could be quarterly updates, it could be the board meeting, the annual board meeting, it depends on I think the family's culture and stripe, but the responsibility of those leaders, and if you have a family office with professional leaders, I really believe that with that infrastructure, those individuals are responsible for carrying out that structure and making sure that the communication and meeting cadence, the documentation, that all of those things are pristine. 

Amy Griman: [15:00] So many of the families that I've worked with, they did not have quite that formal of an architecture, Adam, so they relied heavily on their outside advisors. I worked with a family, was very sophisticated, they did not have a formal family office, they did have a family council, they did have a decision-making process, but external advisors, primarily lawyers, really ran, if you will, that machine. We had some interaction with that family, and there was a huge gap in communication between the advisors. There was also a huge gap in communication down to the next generation. And so, while I'm a lawyer, I know how important the lawyers are, and they're very critical to the family office. I believe that once they're structured, the internal leaders need to control it. 

R. Adam Smith: Need to control it, yeah. 

Amy Griman: Yeah. And if you go beyond that, it's a lot of cooks in the kitchen, I think at that point. 

R. Adam Smith: Okay. Let's go back to your time at BMO, which is a wonderful organization. We've had Shelly on our podcast actually, as you may know from earlier, she's wonderful. Yeah. There are some differences of CA and the US, I think that is worth a brief comment as well, and then talk about what that experience was like working in such a large platform. And maybe just a bit on the private banking team approach that you experienced, like people are always interested to hear how that works within a private bank. 

Amy Griman: [16:00] Yes, really enjoyed my time at BMO, and it was committed to the family office space. And so, working within a larger structure brought a lot of resources and a lot of lift, so it allowed us to really focus on the clients and spend time building our client experience and our delivery model in a way that served those clients and allowed us to continue to grow that business. It was great because I had lots of resources that I know other family offices or MFOs have to build out, so I recognized that was different. It also had a very strong fiduciary orientation and was still a fantastic trust bank. So that was very additive in working with families, especially as they were experiencing a transition due to death, whether it was leadership or generational control. So all of those things were sort of ingrained in the culture of BMO, and in many trust banks, because that's just how they operate. 

Amy Griman: [17:00] So it allowed us to build a dedicated team to serving our families, and those families were both a lot of traditional wealth as well as new wealth creation. I had the opportunity to work across the spectrum, from maybe G4 through a new wealth creator. So, the private bank, we did have all of the services. We could lend money, we could do planning, we could do tax planning work as well as invest and serve as trustee. And we had a core team that was involved with every client. Not that the client was using all of those services, but the approach, I think is a benefit when you're within an organization that has this type of resourcing. 

Amy Griman: It allowed us to create a think tank, and I believe that is really critical for advisors, particularly, who are working with ultra-high-net-worth families, because the strategy behind the conversations we would have with clients really required everybody. So having that entire team allowed us to think strategically and be able to be ready when the clients might need something else. 

R. Adam Smith: [18:00] Of course, now you're in your own boutique, so it's quite different. You can focus on some of the more subtleties and the personal matters, away from product and wrapper and structures and fees and procedures and regulations, so it's quite different, of course now for you. You talked about helping families own their story, which is really important to you and to them of course, but also the industry owning their story and their legacy. I talked about legacy all the time, but just recently at NAIOP conference with Neil Green where I was a keynote speaker next to James Rosebush, who I'm a big fan of, he's actually becoming a guest on our show soon, the former Chief of Staff for most of the Ronald Reagan presidency, and speaking about leadership and his own story, which is really related to legacy. 

R. Adam Smith: You talk about creating the clarity and cohesion around that story. Can we start talking about that a bit? What does that mean to you? 

Amy Griman: Yeah. You know, families have cultures like organizations do, and I find that the families that I've worked with, it was very clear to me that there was a core there that was really beyond the business segment. And that's easy when the family you're in G1 with G2, that can often be an easier way to maintain because of the proximity. But the families I've worked with, and I worked with one family that was into G5, and they were very clear about who they were, meaning, this is what the money does, this is how we gather together, this is how we make decisions, and all of that was informed by what the wealth creators believed and established. 

Amy Griman: [19:00] I was so impressed with that family, I worked with them for several years, and I learned a lot from them because they were they were a bit reticent to change in some of the more formal and or legal elements of running the family, which we worked through. They had this cultural stripe, and it really was around history. There was such a strong history, the story of the family wealth and how it was created, how it was preserved, that was really passed down through generation, and it was something that was held very very precious to people in the family. It really informed how they made decisions and how they looked at their structure and chose advisors and all of those pieces and parts. 

Amy Griman: I was a history major in college, and it clicked with with me that understanding even as the wealth is being created that you're really creating history, and some of those conversations that you're going to have right then and there are going to be very critical for the go forward. I love this business for many reasons, but I'm always fascinated to learn about the families and how they created the wealth. So to me, when I hear those stories, it helps me to understand as an advisor or the leader of a team, or in this case, the owner of a advisory firm, how to adjust. I believe, Adam, and I haven't seen that there is as much conversation around that historical and cultural thread. And when you have that, you can weather some of those challenges that we've talked about earlier in our time. 

R. Adam Smith: [20:00] Thank you. Speaking of college, we're both Midwestern, I'm from St. Louis, you went to undergrad in Indiana, and then you went over to Ohio to law school, so you almost were in a straight line in the Midwest. 

Amy Griman: [21:00] We are. We are, and I'm still here, still live in the Chicago area, so yeah. 

R. Adam Smith: You just went to a larger and colder place, basically. 

Amy Griman: I did. I can't escape the Midwest, apparently. 

R. Adam Smith: What was your thesis, your key paper or focus in history at Franklin College? 

Amy Griman: It was about Booth Tarkington, who was a Indiana writer, he wrote The Magnificent Ambersons. I was fascinated about how he wrote about the change in Indianapolis as it moved from, which is the case in many Midwestern states, from an agricultural state with smaller towns to more industrial slash larger cities creating, and he did it. So anyways, for me, that was something I'd seen growing up in a small town, then moving to a larger city and so I did my senior thesis on his approach and how it changed the view of Indianapolis, and I would say other Midwestern cities. 

R. Adam Smith: [22:00] Just one more thing speaking of small towns, can you just talk a little bit about the Canadian wealth spectrum and the consolidation of wealth in Canada and the system seems very concentrated, more European than the US system. We have much more banks, much larger capital market system, much more wealth expanding through the entrepreneurial ecosystem. BMO and TD and RBC are very concentrated organizations in Canada. I'm just curious about what you think of the, let's say, the wealth management and private banking ecosystem in Canada, and also a bit on the size of the super entrepreneurial system in Canada, because I work a lot with Canadians, I find it an interesting factor that is maybe slowly changing, but I think for a lot of Canadians it's not changing fast enough, the entrepreneurial spirit, the growth, liquidity, capital markets, evolution of flexibility within wealth management. 

Amy Griman: [23:00] I can speak to that a little bit because I did lead the Canadian team, they were part of my group for a period of time, and obviously different tax and legal systems, and I know that my Canadian colleagues and I adapted to lead and help them with this. The tax was the first thing. Now that's not the first thing in the United States, either. Tax alpha and tax minimization where feasible, we know is where we both start, but more in planning and income tax that became the leading factor. And what I would say is the way they used trust was very different. We have a lot more flexibility to use trusts as tools in all kinds of ways, which I could talk about for hours, but they use them differently and it's a lesser spectrum, if you will. 

Amy Griman: [24:00] So those were where I noticed a lot of the differences when it came to family wealth and family offices, a lot of the same challenges that we've talked about today, readiness and transition and leadership, all of those things came to play, so we had a lot of alignment in that area, as well as investments in the United States where they could do that based on their structures and then had some divergence in a few other places. There is, some of my former capital market colleagues would probably be better to answer this question, but there is so much more velocity, volume, and variety in the United States around wealth, so it was interesting, it was fascinating to see the geography in Canada and the concentrations in Toronto and Vancouver, and got to work with families there, but really different. 

R. Adam Smith: [25:00] And we have so many more banks and competitors, you know, RIAs and broker-dealers, so our landscape is incredibly robust. 

Amy Griman: And that was very noticeable as well. 

R. Adam Smith: They're very robust. 

R. Adam Smith: So we'll wrap up on culture and cohesion and just thinking about how you're managing building it offering the Delta Creative Group services for your families and of course there are shared narratives of legacy, their internal organizational procedures communication. It would be great to talk also about let's say fusing governance with human language and personalities and how you like blend structure with culture, and also how that conversation differs between G1 and G2 or the owners let's say versus the children, if you could talk a bit about that as well, just kind of how that communication works. Again, preparing for a sale, you're going to work with G1, the founders, the owners, you're not going to really involve the next gen unless you're informing them, you're not necessarily involving them sometimes. But in terms of the things you're working at at Delta and the broader family ecosystem, I love the term galaxy, Alfredo De Massis, who was on our show actually, one of the legends and my favorites on the show uses the word galaxy. I love that word, the galaxy of the family enterprise. So, we'd love to hear more about that. 

Amy Griman: [26:00] I like galaxy, too. I've been using ecosystem, which is not nearly as elegant as galaxy, for sure. You have to start with culture, in my opinion, and understanding, and what I mean by that is who is that wealth creator, how did they create their business, we were just talking about the Midwest, even where you've grown up and lived, did you live in Europe, were you an immigrant, all of those things really factor into the story, as we were talking about a few moments ago. 

Amy Griman: So understanding that and understanding the dynamics, which I'm careful here because I am not a psychologist or therapist of any type, but I've observed a lot of dynamics and been tasked at times with managing or resolving dynamics that were impactful both positively and negatively on a family's enterprise. Does somebody make all the decisions? Does dad even engage in conversations with the son who is allegedly taking over the business? Is there a philanthropic arm and who runs that and how is that treated? Those are all things that are part of my process to understand one, what's there and what are those structures, what's the decision-making process, my job is to really determine what that decision-making process might be or where there are gaps. So, that's where to me where you start and then you fuse governance and culture. So I think a family who is very relational, has a good communication pattern, tends to put their relationships perhaps above decisions or the business, that governance structure can be different for them than maybe a family that's been more hierarchical or makes decisions in a different way or has a different interaction with each other. These are the things that are important because if you're not considering those, you will have a mismatch between those systems. 

Amy Griman: [27:00] So, understanding what's there and what's really happening and how the family and their professionals interact with each other is that initial observation and assessment. And I think between G1 and G2, I agree with you, if there's a transition, you're spending a lot of time with that wealth creator in that space. I do believe that there is a miss and I've seen this happen where G2 is just ill-prepared to understand what that means. What does it mean for income, what does it mean for my career if I've been involved in the company, what does this mean for dad, what is he going to do, what does it mean for our philanthropy because I spearheaded setting up our family foundation, right? There's a lot of tendrils that come off of that. And the communication I think between G1 and G2 is first informative at a pace that's appropriate and comfortable for everyone, then it moves more into readiness for what happens when G2 takes the reins or G1 is no longer able to run the business. That's a really long answer to understanding some of those actual practices, because human nature is hard to change. We can rewire and change, but I think ignoring what's there can be, I've never seen that go well, is my answer, when it's just been about black and white and paper. 

R. Adam Smith: [28:00] Finally, just maybe a bit on legacy from your perspective. How do you define legacy or how do you help your clients think about legacy these days? 

Amy Griman: [29:00] That is a good question. I think of legacy as the why. The reason the hard work was given, how the money and the wealth has been talked about, how it's been preserved, it's the thread that runs through that conversation. Yes, I think it is represented by the money given to causes that are important and to the life and opportunities given to succeeding generations and so on and so forth, but to me, legacy is that that why center point lasts, and it's a thread that runs through the family wealth and it can stand, that system and that thread will stand. That's legacy. Yeah. 

R. Adam Smith: [30:00] I love that. Thank you for sharing that. We did cover a lot today around the family enterprise and that while structure is really important, it's also important to build the softer elements and the collaborative elements, both internally and externally, with trust, legitimacy, human readiness, and I know you're doing that at Delta, which is great. I want to thank you for being clear today and building your own legacy and offering Delta to the industry, and look forward to seeing that grow. I hope you enjoyed today and that we've had a really good dialogue. It's great to have you on the show. 

Amy Griman: I enjoy it. I could talk about this for hours, so thanks for the opportunity to share about Delta Creative and more importantly to talk about the work we do and love. It's been my pleasure. 

R. Adam Smith: [31:00] Terrific. Great to have Amy Griman on the show today. This is R. Adam Smith signing off. Stay tuned for the next episode of the Family Business Audiocast. 

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