73% of high net worth families based in Southern Africa have a process for agreeing and appraising the contribution they make to their community and wider society, according to Stonehage Fleming’s latest Four Pillars of Capital research (Managing Risk in an age of upheaval, 2023).
The research, based on the results of face-to-face interviews and a 34-question survey, completed by nearly 300 contributors from families and advisers – of which almost 20% is families based in Southern Africa – found that the region leads other regions in this regard, with Europe, the Americas and the UK registering 56%, 48% and 38% respectively. Although those families who formalise this process are in the minority, the research showed that Southern African clients are twice as likely as their European and UK counterparts to put a formal process in place.
“As an adviser to various South African-based clients, this prioritising of support for the local community is great to see,” says Reyneke van Wyk, Head of Stonehage Fleming's Investment Division in South Africa. “Having worked with a number of entrepreneurs in the region over the years, it’s clear how conscious many are of the huge opportunity they have to make a positive difference to their communities. Issues around poverty, unemployment and crime continue in much of South Africa. For many of the families I work with, one of the main reasons for basing themselves and continuing to grow their businesses here is to be part of South Africa’s journey to a more positive future for all.”
Is it surprising, therefore, that South African families don’t do more to publicise these endeavours to deploy their social capital? For Reyneke, this is in line with expectations. “At 68%, the percentage of survey respondents from Southern Africa making the conscious decision not to communicate about their contributions to their communities or wider society is approximately in line with levels for the rest of the world,” he says. “Although it is high, that figure feels about right to me in terms of the clients I am involved with. What I see is entrepreneurs working doubly hard as employers to make a difference yet, more often than not, they prefer a low key approach to promoting these activities.”
According to Reyneke, the research’s findings reflect a trend in South African entrepreneurs’ approach to contributing to their communities. “They are uplifting the local areas by investing in education and youth development, conservation and the environment and providing sustainable employment to people for whom it would otherwise be inaccessible. Those who are committed to inclusive growth are part of the movement to find solutions to South Africa’s long-term social challenges. Build a sustainable community around your business; build a sustainable business.”
Reyneke van Wyk is Head of Stonehage Fleming’s Investment Division in South Africa and looks after the investment portfolios of a number of our family clients with substantial international wealth. He also chairs several family councils.
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