Succession planning is the leading topic being spotlighted amongst the wealthy, according to a report by Julius Baer, with the trend of forming family offices in Asia to address the issue.
Across all regions surveyed (Europe, Asia, Middle East and Latin America), succession planning was the top family-related topic of interest, according to Julius Baer and PwC's «Family Barometer Report 2024».
«Intergenerational wealth transfer and succession planning has moved up from second place [in 2023] to emerge as this year’s top family-related topic across every single region,» the report said.
«This universal focus indicates that families globally are deeply concerned with ensuring a smooth transition of leadership and wealth to the rising generation. As family businesses often play a significant role in regional economies, the emphasis on succession planning reflects a proactive approach to safeguarding the future of these enterprises.»
Asia Practices
Within Asia, the top factor that is stopping wealth transfer discussions with the next generation of recipients is the concern that it might cause a problem in the family, as agreed by 46 percent of respondents.
For those that are effective, informal family meetings were the leading measure (37 percent) implemented to facilitate wealth transfer discussions. Involvement in family and business decisions was the top means (22 percent) of making sure that recipients were ready to manage inherited wealth.
Trending Vehicle
To support wealth transfer efforts, many in the region are turning to family offices as a preferred vehicle. The report noted that Singapore’s strategic location, economic stability, and well-regulated tax system as well as Hong Kong’s robust family office infrastructure and access to diverse investment opportunities made them two attractive hubs for families seeking a base.
«In Asia, it’s becoming a trend for wealthy families to set up single family offices with professionalized practices to manage their wealth and in some cases to prepare and involve the rising generation,» said Christos Anagnostopoulos, head of family office services advisory Singapore, Julius Baer.
Investment, Societal Issues
Aside from family-related issues, respondents said that the top investment-related topic for Asia was inflation protection while the top societal topic in the region was taxation.
The report was based on a survey of over 1,800 Julius Baer, PwC and third party experts, of which 51 percent were relationship managers. Of the ultra-high net worth clients of the respondents, 58 percent were based in Europe followed by Asia (17 percent), the Middle East (12 percent), Latin America (9 percent), North America (3 percent) and others.
