W E A LT H
CITIES
HOME
INVESTING
Keep it in the family
PA S S I O N S
DATA B A N K
P54
W O R D S A N D A N A LYS I S – F LO R A H A R L E Y
This year’s Attitudes Survey included contributions from more than 50 family offices around the world. From succession planning to property investment, we share some of the key findings based on those responses, as well as insights from our global Private Office team
A
s part of our Attitudes Survey, we asked respondents whether they had reviewed their succession plans in the light of Covid-19. After all, it’s hard to beat a global pandemic that disproportionately affects older generations for bringing the issue to the fore. At first glance it seems odd that family offices appear to be less alive to the issue – 48% have reviewed their plans, compared with almost 60% of UHNWIs. But as Nic Arnold of PwC’s Private Office points out, “The whole purpose of having a family office is to obtain highly personalised wealth management. At the outset many will define the family’s overarching ethos and goals to form a plan of what they want to achieve and how to assess whether they are getting there. Approaching things in this way enables ongoing governance over succession planning in good times and bad.”
48%
of family offices have reassessed their attitudes to succession planning during the Covid-19 pandemic 48% also said the younger generation have different attitudes towards property
Generation games According to the Attitudes Survey and insights from our own Private Office team (see panel), younger generations have a different attitude towards property xxxxxxxxxx investment. However, it isn’t only property where there are differing views. “The next generation is much more interested in technology, AI and digitalisation,” says Julie Gauthier, a director at Stonehage Fleming, a multi-family office. “Whether it be with cryptocurrency, tokenising assets, such as real estate or art, or using the blockchain for storage and data protection, we are definitely seeing a shift. “There is also huge interest in the environmental, social and governance (ESG) agenda and philanthropy. Many of the next gens we speak to want to operate in a more environmentally and socially responsible way, with less focus on financial returns and more on impac t and sustainability. On the philanthropic side, we are seeing interest in working and investing in projects in emerging countries and in areas such as health, hunger, and sanitation.” Arnold agrees. “Younger generations are often particularly focused on climate change and the environment, not for the reputational gains, but because that is who they are and where they want to drive things. The best way to align this is to think of investments and portfolios in terms of ‘what this means to us and how it fits into the family charter’, rather than following what others are doing.”
What is your interest in ESG investments? 49%
are more interested in ESG-focused investments than they were 12 months ago
63%
feel they have all the information they require to assess ESG-related investments
The Attitudes Survey concurs. Half of family offices are more interested in ESGfocused investments than they were 12 months ago, with a similar number (54%) increasing their philanthropic activity. A UBS survey found that 62% of family offices believe impact investments are important for their legacy. This is perhaps why they feel more confident to make such investments. Our survey found that 63% feel they have all the information they require to assess ESGrelated investments, compared with just 39% of the wider UHNWI community.
