Family Office: 3 Reasons Malaysians Need to Know This Now

Family Office: 3 Reasons Malaysians Need to Know This Now

The family office sector has grown rapidly, collectively managing around $5.9 trillion in assets in 2023. Especially in the Asia-Pacific region, with a 44% increase between 2017 and 2019, it highlights its appeal among the wealthy. In Malaysia, this is a new industry as we don’t have a regulatory framework in place. The unity government in 2023 is the first to put concrete efforts into concentrating on this globally growing industry. Here are the reasons why we must know this now.

1) Focus of the Malaysian Government

In June 2023, Malaysian Prime Minister Anwar Ibrahim announced initiatives to attract more investors, particularly to small and medium sectors of the new economy. Following this, the Ministry of Finance and the Securities Commission will develop policies to encourage the establishment of family offices in Malaysia.

In March 2024, the Malaysian government will introduce a new regulatory framework aimed at attracting family offices, with the announcement scheduled for this year’s budget. This update comes from Datuk Seri Awang Adek Hussin, the chairman of the Securities Commission Malaysia.

All these developments raise an important question: Is there enough talent to manage all this wealth, both present and incoming, and is the Malaysian market ready to handle it? For now, the answer is no.

However, if you are looking for an international family office, we have good news for you. One of Asia’s top family offices has just set up their office in Malaysia.

2) Family Office Opportunity Cost

Eduardo Saverin, a co-founder of Facebook, utilised a family office to manage his assets after relocating to Singapore, which according to the New York Post, saved him approximately $288 million in taxes. This strategic financial management exemplifies the substantial benefits that can be realised through the effective use of family offices, not just in tax savings but also in broader wealth preservation and growth strategies.

Another example is Joseph Tsai Co-Founder of Alibaba Group, Tsai’s family office purchased the Brooklyn Nets of the NBA for $3.5 billion in 2019. By 2024, the value of the investment has increased to $3.85 billion. This represents a $350 million increase in just five years, showcasing a successful example of strategic investment management by a family office if you are considering similar strategic financial management, you might find it beneficial to explore how to set up an offshore trust in Malaysia

3) Asia’s Wealth Landscape & Talent Gap

By 2027, there will be roughly 210,000 ultra-high-net-worth-individuals (at least US$30mil or RM141mil worth) in Asia, up by 39.8% from 2022.

NameNet Worth (2023)DescriptionCountryIndustryFamily Office NameMajor InvestmentsPhilanthropic ActivitiesYear EstablishedEducationAwards/Recognitions
Sergey Brin$94.5 billionCo-Founder of GoogleSingaporeTechnologyBrin Family OfficeReal estate, technology startupsBrin Wojcicki Foundation2005Stanford UniversityMarconi Prize, National Medal of Technology
Mukesh Ambani$93.4 billionIndian billionaire businessmanSingaporeEnergy, RetailReliance Family OfficeOil, telecommunicationsReliance Foundation1981Institute of Chemical TechnologyBusiness Leader of the Year
Liang Xinjun$4.2 billionChinese billionaire, co-founder of Fosun GroupSingaporeInvestmentFosun Family OfficeHealthcare, real estateFosun Foundation1992Fudan UniversityTop 10 Chinese Entrepreneurs
Ray Dalio$19.1 billionAmerican hedge fund investorSingaporeFinanceDalio Family OfficeHedge funds, real estateDalio Foundation1975Harvard Business SchoolPhilanthropist of the Year
Jack Ma$23.2 billionFounder of Alibaba GroupHong KongTechnology, E-commerceLakeside PartnersE-commerce, fintechJack Ma Foundation1999Hangzhou Normal UniversityAsia’s Heroes of Philanthropy
Li Ka-shing$34.6 billionHong Kong business magnateHong KongConglomerateHorizon VenturesReal estate, technologyLi Ka Shing Foundation1950NoneGrand Bauhinia Medal
Joseph Tsai$8.1 billionCo-Founder of Alibaba GroupHong KongTechnology, InvestmentBlue Pool CapitalSports franchises, real estateTsai Foundation2012Yale UniversityBusiness Person of the Year
James Dyson$23.0 billionFounder of DysonSingaporeTechnology, Consumer GoodsWeybourne GroupTechnology, real estateJames Dyson Foundation2013Royal College of ArtOrder of Merit, Royal Designer for Industry

Wealthy Individuals Who Set Up Family Offices in Asia

Wealthy Malaysians often park their wealth abroad due to the current talent gap in the country. Family offices require a unique skill set, blending professional expertise with a personal touch, which is uncommon in other workplaces. KPMG’s report notes that within the family office business in Asia, CEOs earn between SG$158,001 and SG$500,000 (RM1.76 million) per year, excluding bonuses.

Understanding Family Offices

A family office is a private wealth management advisory firm that serves ultra-high-net-worth investors. Family offices are distinct from traditional wealth management shops in that they offer a total outsourced solution to managing the financial and investment side of an affluent individual or family.

History: The concept began with the Rockefeller family in the late 19th century, who pioneered this approach to consolidate management of the family’s sprawling empire under a single office.

SFO vs. MFO:

Single Family Office (SFO): Manages the wealth and personal affairs of one family. It offers highly personalized services and confidentiality, with strategies tailored to the specific needs of that family.

Multi-Family Office (MFO): Provides similar services but to multiple families. MFOs can offer cost-sharing benefits and access to a wider range of expertise and investment opportunities, making them suitable for families that may not have the resources to run a standalone office.
Both types of family offices provide customized financial care, but the choice between SFO and MFO depends on the family’s size, costs considerations, and desired exclusivity of services.

Comparison of family offices in Singapore, Hong Kong, and Malaysia 

FeatureSingaporeHong KongMalaysia
Legal EntitiesPrivate Limited Company, Trust, VCCLimited Liability Company, TrustPrivate Limited Company (Sdn Bhd), Trust, Labuan Entities
Regulatory EnvironmentMAS, ACRASecurities and Futures CommissionCompanies Commission of Malaysia, Labuan FSA
Tax IncentivesSections 13D, 13O, 13UTax concessions for investment profitsNo dedicated tax incentives for family offices
Market GrowthRapid expansion of SFOs; robust frameworkTarget to attract 200 family offices by 2025Emerging market; initial government initiatives
Preferred StructuresHolding company overseeing an investment fund and a family office entitySFO emphasized; Family-owned Investment Holding VehiclesVarious options, including traditional and Labuan structures
Licensing RequirementsLicensing exemptions for SFOs; others require licenseLicense required for regulated activitiesGeneral business registration, no specific license
Investment VehiclesVCC (Variable Capital Company)Typically structured around legal entities like LLCsSdn Bhd, Trust, Labuan trusts, foundations, and PCCs
Global CompetitivenessLeading hub in Asia due to legal and tax frameworksCompeting closely with Singapore for leadershipStriving to enhance competitiveness

Malaysia currently lags behind Singapore and Hong Kong in establishing family offices primarily due to the lack of a specialised regulatory framework and dedicated tax incentives. While Singapore and Hong Kong offer clear and supportive legal structures, regulatory guidance, and fiscal benefits tailored to the needs of family offices, Malaysia has not yet developed similar incentives or regulatory clarity. This deficiency makes it challenging for potential family office establishments to navigate the legal and fiscal landscape, thereby affecting Malaysia’s competitiveness as a desirable location for family offices in the region.


We must understand and prepare ourselves for family offices before the new regulatory framework announcement in the budget this October. As the saying goes, the early bird catches the worm, and opportunities always favor those who are well-prepared. The future of family offices in Malaysia looks bright, whether you’re a wealthy investor or someone looking to work in this growing industry.

(Family Inheritance Association of Malaysia, 2024)

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