Global high net worth families have concerns about delegating the management of their businesses and investments, as well as the next generation’s ability and commitment to manage the family assets, according to a new report by Barclays Private Bank.

Two-thirds of the older generation is concerned about the ability of their children to take over the family business, and 58 percent of families say differing outlooks on life is creating friction in succession planning, according to the report «Smarter Succession: The Challenges and Opportunities of Intergenerational Wealth Transfer,» published by Barclays Private Bank on Monday.

Only 45 percent of millennials currently feel prepared to run the family business, but 94 percent expect that they will have to take over. The current pandemic has also shifted the aims of many families and family businesses to make intergenerational wealth transfer even more challenging, with 4 in 10 family offices are significantly reassessing their financial strategy as a result of COVID-19, the report said.

«The transfer of wealth between generations is an emotive subject for families and one that has risen to the top of the agenda recently, accelerated by the pressures of COVID-19. It is important for families to have open, honest dialogue about their priorities and concerns, and build trust between the generations. Knowing clients’ priorities and concerns enables us to work with them to ensure their legacy is carried on in the best way for all,» Effie Datson, Global Head of Family Offices, Barclays Private Bank, said.

High on the Agenda

Barclays noted that around 25,000 high net worth individuals in Europe, Africa, Asia and the Middle East are estimated to transfer $15 trillion to the next generation by 2030, citing wealth data specialist WealthX.

The report was based on a study that interviewed over 400 global high-net-worth families in France, Germany, Hong Kong, India, Italy, Qatar, Saudi Arabia, Switzerland, Singapore, U.A.E. and U.K. about their issues and concerns in succession planning, applying behavioral science analysis. It said that building trust and understanding between generations will shape the success of wealth transfer among high net worth (HNW) families over the coming years.