“We find our clients to be more multijurisdictional than ever before, with families often ending up dispersed across the globe,” says Nada Al Hashimi, Family Office Analyst at Knight Frank. “When we speak of family businesses we automatically think: succession planning, legacy and impact, and capital and investment flow. Family businesses have always had a large impact on the global economy making up 70 – 90% of the global GDP and generating 40- 60% of employment in many economies worldwide. For all those reasons, and many more, it is imperative that family businesses sustain growth and move on to the next generation”. Unfortunately this is not always the case, where research shows that only a third of family businesses make it to the next generation, 12% to the third generation and only 3% to the fourth. This is mainly because several family businesses do not have a solid succession plan in place. To ensure these businesses are maintained over many generations several steps could be adopted by the family including: hiring employees that are not family members, focusing on communication and many others.
“Another trend we have been noticing in family business and wealth management is the rising involvement of women”, said Nada.” The number of high net worth female individuals has been increasing faster than that of male high net worth individuals. In the Middle East, where societies are more traditional and the senior seats are dominated by the male figures in the family, more women are studying abroad to come back home with a strong set of skills and expertise ready to take on senior roles in their family businesses”.
An increasing commitment to philanthropy and the growing involvement of women and the next generation in managing UHNW family wealth is an exciting and challenging development for those advisors who can adapt to the changing attitudes and aspirations of their clients.
