Turning Wealth into Legacy: A Strategy for Families Who Think Long-Term
Jul 16, 2025
In 1969, Norway discovered oil in the North Sea. For many countries, such a windfall would have triggered a frenzy of spending, corruption, and short-term gain. But Norway chose a different path. It treated its oil not as a personal jackpot, but as a national responsibility. The government created a national oil company, Stat-oil, and later launched the Government Pension Fund Global, now the world’s largest sovereign wealth fund, worth over $1.6 trillion. The fund invests globally, spends only a small portion of its returns, and maintains full transparency.
The result? Norway transformed a temporary resource into a permanent engine of national wellbeing. Today, it is not only one of the wealthiest countries per capita, but also one of the most educated, healthiest, safest, and socially cohesive. That is real wealth and it didn’t happen by accident.
This story is more than a case study in economic policy. It’s a metaphor one that Richard and I often use to help families re-frame their relationship with capital.
The Challenge of Sustaining Wealth
Many of the families we work with at Waugh McDonald have built significant wealth over the past two or three generations, often through entrepreneurship, land, or early investments. Their success is real and admirable. But with that success comes complexity. As wealth grows, so too do the challenges of managing it across generations, households, and jurisdictions.
In our experience, families often assume that the next generation will naturally continue the legacy with the same clarity, unity, and capability. But wealth alone doesn’t guarantee alignment or resilience. Without a clear structure, even the most successful families can find themselves exposed to fragmentation, misaligned expectations, or missed opportunities.
That’s why we often recommend a strategic reset: transitioning from informal, personality-driven wealth management into a formalised family wealth fund model. This isn’t about stepping away from enterprise or ambition. Quite the opposite, it’s about creating a platform that supports entrepreneurialism without being wholly dependent on it. It protects against downside risk and ensures that all family members, across generations, have access to the same foundation of security, education, and opportunity. More than that, this shift towards true stewardship often brings renewed meaning and purpose to the wealth itself, transforming it from a source of pressure or division into a unifying force for long-term wellbeing and contribution.
The Family Wealth Fund: A Modern-Day Sovereign Approach
We encourage many of our clients to consider establishing what we call a Family Wealth Fund. Inspired by the principles behind sovereign wealth funds, it is designed not for immediate consumption, but for long-term stewardship. It provides for the essentials, security, health, education and serves as a source of capital for family entrepreneurship through structured loans. It is governed by a family charter, supported by institutional-grade investment management, and guided by a shared philosophy: that each generation are stewards, not owners, of the family legacy.
Our portfolios are managed in partnership with Morningstar Investment Management, whose process reflects the same institutional-grade thinking found in the world’s most respected sovereign wealth funds. Their approach, long-term, valuation-driven, and grounded in rigorous global research aligns closely with the principles behind the Family Wealth Fund model. It ensures that families benefit from the same level of discipline, diversification, and oversight that underpins the investment strategies of major global institutions, but tailored to their unique goals and governance.
That said, we recognise this is not the only path. For some families, particularly those whose wealth is deeply embedded in operating businesses or industrial dynasties, this model may not be the right fit, or may need to be adapted significantly. The key is not to follow a formula, but to find a structure that reflects the family’s reality, values, and ambitions.
For many, however, this strategy offers a compelling reset: a way to future-proof the family’s capital, create alignment across generations, and build a platform that supports both stability and entrepreneurial freedom. It’s not about stepping back, it’s about stepping forward with clarity, resilience, and purpose.
How We Help Families Get There
Getting to this point is not simple. It requires a great deal of work technical, emotional and strategic. Richard and I work closely with families to guide them through this journey. We don’t just advise, we build.
We help families:
Design governance structures that reflect their values and decision-making culture, including family councils, investment committees, and dispute resolution protocols.
Establish legal entities such as trusts, holding companies, and family offices, often across multiple jurisdictions to ensure asset protection, tax efficiency, and continuity.
Construct investment platforms that are diversified, transparent, and aligned with the family’s long-term goals. This includes portfolio bonds, general investment accounts, sub-funds for specific purposes (education, healthcare, entrepreneurship), and access to institutional-grade global investment.
This is an end-to-end, integrated approach. We work in close collaboration with the family’s legal, tax, and philanthropic advisors to ensure alignment across the ecosystem. Our role is to be the architect and steward of the family’s financial infrastructure, ensuring it is robust, resilient, and ready for the future.
Real-World Stewardship in Action
We’ve helped families navigate complex liquidity events, relocate internationally, and restructure their entire wealth architecture to meet new regulatory and lifestyle needs. In some cases, we’ve been appointed as directors of the entities we helped create, ensuring continuity, compliance, and strategic oversight.
We’ve guided families through multi-generational transitions, helping them establish family banks, philanthropic foundations, and education funds. We’ve built governance frameworks that balance tradition with innovation, and investment platforms that combine global reach with local relevance.
These are not theoretical models, they are living structures that support real families in real time. And they work.
The Human Dimension
But perhaps most importantly, we help families understand themselves. We use a combination of structured diagnostic tools and facilitated workshops to surface core values, assess alignment, and build a shared sense of purpose. One tool helps family members articulate their personal and collective values through visual models and guided reflection often revealing surprising clarity about what truly matters. Another provides a confidential, research-based assessment of how the family and enterprise are perceived across generations, highlighting areas of strength, tension, and opportunity.
Together, these tools create a foundation for intentional, values-driven governance. They help families move beyond assumptions and into meaningful dialogue, ensuring that wealth is not only preserved but energised by the unique contributions and aspirations of each generation.
A Call to Stewardship
Norway didn’t get rich fast. It got rich for the long haul. It used its oil not to indulge the present, but to empower the future. That same mindset can and should guide families of wealth in Kenya and beyond.
The question is not just how much wealth you have. It’s what you do with it. Will it divide your family, or unite it? Will it fade, or will it flourish?
At Waugh McDonald, we believe the answer lies in stewardship, structure, and strategy. The opportunity is now. Families who act with clarity and courage can build legacies that last not just for decades but for generations.
Want to explore what a legacy strategy could look like for your family?
Email us at info@waughmcdonald.co.ke we’d be glad to help.
