AI Governance for Family Offices
Good AI governance names the people who can say yes, no, and stop. It also gives staff and advisers rules they can follow without calling a committee for every prompt.
Family office AI governance is the written answer to seven questions: Which tools are allowed? Which records may go in? Who gets access? Which vendors are trusted? What may agents do? What gets logged? How does the office recover or change providers?
Name the people who can say yes, no, and stop.
Family offices bring together principals, employees, investment teams, outside counsel, tax advisers, household staff, and technology vendors. A generic employee policy does not account for those different duties and access patterns.
Keep the group small. The family or its delegate sets the risk appetite. One executive approves uses. Technology and security owners manage access and monitoring. Counsel reviews privacy, contracts, fiduciary duties, and jurisdiction. The person responsible for the work still owns the result.
NIST organizes AI risk work around four functions: Govern, Map, Measure, and Manage. A family office can use that sequence without turning governance into a large bureaucracy.
Write down seven decisions.
| Domain | Required decision | Evidence to keep |
|---|---|---|
| 1. Policy and accountability | Who approves use cases, exceptions, and changes? | Policy, role assignments, decision record, exception log. |
| 2. Data rules | Which information may enter each tool or model? | Data classes, source register, retention rules, prohibited-data list. |
| 3. Identity and access | Which principals, staff, advisers, and vendors can reach which data and functions? | Role matrix, access reviews, joiner and leaver records. |
| 4. Models and vendors | Which providers are approved, and under what contractual and technical conditions? | Diligence record, data-flow map, terms, evaluation results, exit plan. |
| 5. Agents and actions | What may an agent read, draft, recommend, or change? Which steps need approval? | Tool permissions, approval gates, action logs, rollback procedure. |
| 6. Monitoring and incidents | What is logged, reviewed, escalated, contained, and reported? | Audit logs, review schedule, incident plan, exercise results. |
| 7. Continuity and succession | How will the office change providers, recover service, and transfer operating knowledge? | Backups, export test, architecture record, successor access process. |
Match the rules to the damage a mistake could cause.
Routine work
Summarizing public research or drafting from non-sensitive material may need only an approved workspace, ordinary login controls, and a quick source check.
Sensitive work
Searching internal documents, preparing portfolio commentary, or comparing due-diligence records calls for approved sources, role-based access, citations, review, and better logs.
Actions that change something
Moving money, changing permissions, sending instructions, or altering books and records needs explicit authorization. Add dual control where it fits, narrow tools, transaction limits, independent monitoring, and a tested way to contain or reverse mistakes.
“Human in the loop” is not a job description.
Name the person, the evidence they see, the decision they make, and the backup when they are unavailable.
Write the rules around one real workflow.
- Inventory current tools, including unsanctioned use and AI features embedded in existing software.
- Classify the information the first use case needs and the harms that could follow from disclosure or error.
- Assign an executive owner, technical owner, reviewer, and incident contact.
- Approve the model, data flows, retention, access, and vendor terms.
- Test ordinary tasks, misuse, prompt injection, unavailable sources, and incorrect outputs.
- Review access and performance on a schedule tied to risk, not a generic annual calendar.
The private-wealth AI threat model supplies the misuse cases. The build, buy, or steward framework helps assign long-term operating responsibility.
Questions that turn policy into working rules.
Who should own AI governance in a family office?
The family or its delegate sets the risk appetite. Name one executive to approve uses, then assign the technical, security, legal, and business work to specific people.
What belongs in a family office AI policy?
List the allowed tools and uses, prohibited data, access rules, review steps, agent limits, logs, vendor checks, incident contacts, exceptions, and exit plan.
Should prompts and outputs be kept?
Keep them only as long as the job, legal duties, privacy needs, and audit trail require. Public research, sensitive family records, and automated actions may need different rules.
How often should the rules be reviewed?
Review them when a model, vendor, connection, data source, permission, or use changes. Check access and incident readiness on a schedule that fits the risk.
How should outside advisers receive access?
Give each adviser a named account, a clear purpose, narrow permissions, an end date, and logged activity. Avoid shared accounts because they are hard to trace and revoke.
Where these claims come from.
- NIST, AI Risk Management Framework
- PwC, “How AI is reshaping the modern family office,” June 8, 2026
- OWASP, Top 10 for Large Language Model Applications
Published 2026-07-12. Product terms and legal duties change. Check them against the family office’s current facts before acting.
Put the rules to work
Bring one workflow. We will map the rules around it.
Start with the people, records, vendors, and decisions involved.
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