This week, Swiss private bank Julius Baer published its Family Barometer Report 2023, produced in collaboration with PWC Switzerland. The report assesses the topics that matter most to wealthy families this year.
Wealthy families are taking political stability and geopolitics into account far more than before, not only in their investment decisions but also in how they structure their overall wealth, the company said.
Globally, the survey shows that tax and regulation comes second, having been fourth in 2022. Ongoing political instability and pressure on public sector finances mean that changes in taxation and regulation will likely continue. However, these adjustments require an understanding of the finer details of each country, making local specialist expertise essential, the firm said.
“Topics related to family wealth, beyond investments and collaboration with advisors, are a subject as old as time. Yet the upheaval of the past three years explains why it’s the top topic clients want to address once again this year. In recent decades, wealthy families have spread across the world as they go to college, work and marry in different countries, making their business affairs understandably complex. » say the authors of the report. “But then Covid-19 turned the world upside down in 2020, increasing this complexity. Since then, geopolitics has made constant challenges normal. As a result, wealthy families need more specialized advice, not only to respond complexity, but also to manage the inherent risks raised by exposure to a multitude of legislation.
Families in Asia also reported the greatest interest in discussing family wealth topics with advisors, compared to other regions, the firm added.
The past year has confirmed the greater complexity of our world: geopolitical tensions have intensified, central banks have raised interest rates to contain resurgent inflation, and asset prices have corrected. As a result, wealthy families need more specialist advice, not only to deal with complexity, but also to manage the inherent risks of exposure to a multitude of legislation, the firm continues.
Additionally, the survey found that, compared to other regions, families in Asia place the highest importance on philanthropy. Talking about how philanthropy aligns with family values can foster cohesion across different branches and generations of an extended international family. Additionally, engaging a family’s next generation from a young age can instill pride, responsibility and identification with family values, the company said.
Wealthy families in Asia also appear to place relatively less importance on family governance and engage less in real estate investments than in other regions, the survey found.
At the same time, like families in the Middle East and Africa, the amount of the first substantial investment made by Asian families is higher than that of families in the Americas and Europe.
The barometer monitors the evolving opinions of financial services experts who work with and advise wealthy clients. For the 2023 edition, more than 1,500 internal and external experts from Europe, Asia, the Middle East, Africa and the Americas were surveyed.