The Bank of America family office study and its governance gap

What the study found

Bank of America published its 2026 Family Office Study, titled Building for Generations, on 20 October 2026. The research firm Escalent surveyed 355 US family office decision makers for it, in offices ranging from 25 million dollars in assets to more than 5 billion, the majority above 500 million, with the survey fielded in January and February 2026. It is a US dataset, and that scope matters for how a corridor family should read it, but its central finding is not a US finding. It is a structural one about the difference between naming a successor and being ready for one.

The headline numbers are a study in false comfort. Most offices, 83%, have identified a successor, which sounds like succession planning is largely done. It is not. Only 27% have a trust distribution policy or guiding principles in place, and of the quarter of offices that actually saw a leadership transition in the last decade, only 37% described the incoming principal as very prepared.

The family has decided who, in other words, far more often than it has decided how, and the how is the part that governs what happens to the wealth when control changes hands.

The governance findings around that gap are consistent. Nearly all offices, 91%, agree that governance and family education keep the family aligned on priorities, and nearly nine in ten agree governance structures reduce family disagreements, yet only 40% run a formal family education program, and 73% say they plan to adopt additional governance structures over the next three years. The top governance challenge they name is family dynamics, at 45%, ahead of the complexity of shared assets at 37% and undefined family expectations at 36%.

Alongside the governance picture, the study records a portfolio shift the next generation is driving. Among offices with a potential next-generation principal, 79% expect alternative investments to take a larger share of the portfolio and 77% expect philanthropic priorities to change. Private equity already makes up 27% of family office alternative allocations, with 59% planning to increase exposure over three years, four in ten offices now hold sports investments, and three in ten of those with art value the collection above 25 million dollars. The next generation is expected to invest differently, and in more places.

What it means in the corridor

The study reads its own central finding as a family problem. The gap between naming a successor and preparing one is framed as a risk to family alignment and continuity, and for a single-jurisdiction US family that is the right frame. For a family whose office, people, and assets sit across the UK, the UAE, and Ireland, the same gap is also a tax problem, and that is the part the study and the coverage of it do not reach.

The reason is that the governance instruments the study finds missing are not soft documents. A trust distribution policy, a set of guiding principles, a governance structure, these are the instruments that allocate control, and in the corridor control is what is taxed. The point is developed in full in the analysis of why a family office becomes institutional through its governance, and the short version is that every decision about who decides, and where, is also a decision about who taxes the result.

Take the study's own headline. An office that has named a successor but written no distribution policy or governance structure has, in corridor terms, decided who will hold control without deciding how that control is exercised or where. If the incoming principal is UK resident and begins taking the real decisions of a Dubai family office from London, the office is centrally managed and controlled from the UK and becomes UK tax resident on its worldwide income, whatever its licence says, the mechanism set out in the analysis of the UAE family office and the UK control trap.

The readiness gap the study measures is, for a mobile family, a residence gap waiting to open at the moment of transition.

It reaches the structures beneath the office too. Where the wealth sits in a foundation built to be an orphan, the protection depends on the founder genuinely not controlling it, and a succession that hands control to a next-generation principal who is UK resident can retain that control at one remove, through the office, and undo the foundation, as the analysis of the DIFC and ADGM foundation explains.

The 73% of offices planning to add governance structures in the next three years are, in the corridor, deciding how their structures will be taxed, not only how the family will get along.

The portfolio shift sharpens the same point. As the next generation moves into private equity, direct deals, sports, and art, the holding structures become more numerous and more cross-border, and each one raises a substance and jurisdiction question, which centre holds it, whether it needs a fund, whether a legacy offshore vehicle should be brought onshore, set out in the analyses of ADGM against DIFC for a holding company and setting up a fund in the DIFC or ADGM.

Governance that is designed only for family alignment, and not for where control and substance sit, leaves those questions unanswered at exactly the moment the portfolio makes them urgent.

The catch, and who is and is not affected

The exposure is not uniform, and it is worth being precise about who the corridor overlay actually bites.

A family office whose principals, next generation, and decision-makers are all genuinely resident in the UAE carries the least residence risk, because there is no UK or Irish control to attract a charge, though it still has to keep the foundation genuinely independent and the office genuinely substantive. The families most exposed are the ones the corridor is full of: a founder who has relocated to Dubai but whose designated successor is at university or working in London, a next-generation principal who splits time between the UAE and the UK, or an office that is licensed in the DIFC or the ADGM while its real decisions are still taken wherever the family happens to be. For them the study's governance gap and the UK control trap are the same problem seen from two directions.

And the study's reassurance cuts the wrong way for a mobile family. An office that reads 83% have a successor as a sign it is on track, and defers the distribution policy and the governance structure as paperwork for later, is deferring precisely the instruments that would place control deliberately rather than let it default to wherever the successor lives. The comfort the headline offers is the trap.

What to do now, and what to watch

The study is a prompt rather than a deadline, but the prompt is a good one, and the actions it points to are the ones a corridor family can take before a transition rather than during it.

• If you have named a successor but written no distribution policy or governance structure, that is the gap the study measures and the one to close first, and in the corridor it should be closed with the tax of control in view, not as a family-harmony exercise alone.
• Map where your next-generation decision-makers are tax resident before handing them control of the office or the structures beneath it, because the handover of control is also a handover of tax residence if they are in a taxing jurisdiction.
• If you are among the 73% planning to add governance structures, align them with the DIFC or ADGM frameworks and the central-management-and-control and substance reality, so the governance you build supports the tax position rather than quietly undermining it.
• Treat the portfolio shift as a structuring trigger. New alternatives, direct deals, and trophy assets each need a holding decision, and the time to make it is as they are acquired, not in a later clean-up.

What to watch is the detail behind the headlines. The figures here are from the study as published on 20 October 2026, and Bank of America has released a fuller report, Building for Generations, with the underlying breakdowns. The numbers are a US survey of 355 offices fielded early in 2026, so they describe a direction of travel rather than a rule, and a family should treat them as a well-evidenced prompt to check its own governance, not as a benchmark to copy.

The read

The study has done the sector a service by putting a number on something advisers have long seen: families decide who will inherit control far sooner than they decide how it will be held. That gap is a continuity risk everywhere. In a corridor where the family, the office, and the assets sit in different tax systems, it is also a residence and attribution risk, because the governance documents that go missing are the ones that place control, and control is what the UK and others tax. The 83% who have named a successor have done the easy part. The 27% who have written down how control passes have started the part that actually decides the tax, and for a cross-border family that is the part worth finishing first.

Frequently asked questions

What is the 2026 Bank of America Family Office Study?

It is Bank of America Private Bank's annual survey of family offices, published in its 2026 edition under the title Building for Generations on 20 October 2026. The research firm Escalent surveyed 355 US family office decision makers, in offices ranging from 25 million dollars in assets to more than 5 billion, the majority above 500 million, with fieldwork in January and February 2026. Its theme this year is the coming generational transition and how the next generation will invest, govern, and preserve family wealth.

What did the study find about succession and governance?

Its central finding is a readiness gap. While 83% of offices have identified a successor, only 27% have a trust distribution policy or guiding principles in place, and of the quarter that saw a transition in the last decade only 37% said the incoming principal was very prepared. 91% agree governance and education keep the family aligned, but only 40% run a formal education program, and 73% plan to add governance structures within three years. The family has usually decided who will take over, but far less often how control will actually be held and exercised.

What is the governance gap the study identifies?

It is the distance between naming a successor and building the governance that makes a succession work. The missing pieces the study measures, a distribution policy, guiding principles, formal education, and governance structures, are the instruments that define how decisions are made, how wealth is distributed, and how disagreements are resolved after control changes hands. An office can have a named successor and still have none of the framework that tells that successor, and the rest of the family, how the wealth is to be governed.

Why does a US family office study matter for a UK, UAE, or Ireland family?

Because the finding is structural, not national. The survey is of US offices, so its exact percentages describe the US market, but the gap between choosing a successor and preparing the governance is the same wherever a family office sits. For a family in the UK-UAE-Ireland corridor it matters more, not less, because the governance that is missing carries a tax consequence a US single-jurisdiction office does not face, namely where control is exercised and who is therefore entitled to tax it.

How does family office governance affect tax in the UK-UAE corridor?

Through control. A company is UK tax resident where its central management and control is exercised, so if a next-generation principal takes the real decisions of a UAE family office from London, the office can become UK tax resident on its worldwide income regardless of its licence. Governance that allocates control to a UK-resident principal can also retain, at one remove, the control a founder was supposed to give up to a foundation, undoing the foundation's protection. In the corridor the governance design and the tax position are the same question, which is why a distribution policy or a governance structure is not only a family document.

What is the difference between naming a successor and having a succession plan?

Naming a successor answers who. A succession plan answers how, and the study shows most families have done the first without the second. A plan sets out how control and ownership pass, how the wealth is distributed, how the next generation is prepared and educated, and how the governance bodies operate once the founder steps back. For a cross-border family it also has to answer where the successor will exercise control, because that determines the tax residence of the office and the treatment of the structures beneath it. A name on its own leaves all of that undecided.

What did the study say about family office portfolios and alternatives?

It found the next generation pushing portfolios further into alternatives. Among offices with a potential next-generation principal, 79% expect alternatives to take a larger share and 77% expect philanthropic priorities to change. Private equity is already 27% of family office alternative allocations, with 59% planning to increase it over three years, four in ten offices now hold sports investments, and three in ten with art value the collection above 25 million dollars. For a corridor family each new holding is also a structuring decision about which jurisdiction holds it and whether it needs its own vehicle.

What should a cross-border family do in response to the study?

Treat it as a prompt to close its own governance gap before a transition, not after. If a successor is named but no distribution policy or governance structure exists, build that framework now, and build it with the tax of control in view rather than as a family-harmony exercise alone.

Map where the next-generation decision-makers are tax resident before handing them control, align any new governance with the DIFC or ADGM frameworks and the substance rules, and treat each new alternative or trophy asset as a holding decision in its own right. The study's reassurance that most families have a successor is the part a mobile family should trust least.