Balancing investment return with social responsibility
The results of the latest research report compiled by international family office Stonehage Fleming have revealed a gap between the mind-set and implementation of responsible investing. The Four Pillars of Capital Report: The Next Chapter showed that while over 75% of ultra-high net worth families acknowledged a preference for responsible investment, only 21% are actively incorporating a values-based approach in investment portfolios.
This contrast is likely attributed to a confusion about the wide range of SRI (Socially Responsible Investment) products on offer by asset managers, says Reyneke Van Wyk, Head of Stonehage Flemings’ Investment Division in South Africa. While respondents demonstrated an increasing interest in SRI, which aims to generate specific social or environmental benefits in addition to financial returns, they also confessed that on a practical level it was not as easy in the traditional investment world to do ‘good’ while also generating benchmark-beating returns for investors.
“Historically, investors have primarily been concerned with the end rather than the means, putting portfolio performance as the primary focus,” said Van Wyk. “However, as was highlighted in our Four Pillars of Capital report, this attitude is changing. For many families and private investors, the gap between investor and investment is closing.”
Considering the variety of socially responsible investing philosophies open to todays’ investors, Stonehage Fleming believes that Environmental, Social and Governance (ESG) investing marries well with a traditional investment management approach and with the long-term investing approach of UHNW* families.
PBI Germany Awards winners announced
Private Banker International’s Germany Awards were announced on Tuesday at a ceremony in Frankfurt. Stonehage Fleming were delighted to win Outstanding Family Office Proposition in Germany.
These awards are an extension of the well established Private Banker International Global Awards that took place in Singapore last year. These awards are designed to identify leading institutions that are setting new standards in private banking and wealth management in Germany. The shortlist of finalists underwent a rigorous selection process and our independent judging panel chose the awards winners.
What Happens When Billionaires' Children Inherit
It is not always about beautiful homes, lush holidays, and expensive educations. When sons and daughters of wealthy families inherit their entitled fortunes, there are often dramatic side effects. And this is causing many-a-billionaire to re-think what they leave behind.
The Real Rich Kids Imagine being given everything you could ever want from a young age. The best education, holidays and homes, then told you never really need to work because your family has more than enough money. A dreamy scenario for some. But there is normally a side effect: wealth robs children of motivation. The more money that is given to children from a young age, the less passion and motivation they have, say wealth advisors. “I’ve worked with next-generation family members who say ‘why go to university, what’s the point?
No one’s going to be impressed with what I do, because my entrepreneurial parents have nailed life,’” says Lucy Birtwistle, a relationship manager at Stonehage Fleming, a multi-family office. Her work often involves meeting with these disenfranchised children and trying to find their purpose and vision. “Each individual needs a purpose, a reason to get up in the morning”.
Balancing investment return with social responsibility
The results of the latest research report compiled by international family office Stonehage Fleming have revealed a gap between the mind-set and implementation of responsible investing. The Four Pillars of Capital Report: The Next Chapter showed that while over 75% of ultra-high net worth families acknowledged a preference for responsible investment, only 21% are actively incorporating a values-based approach in investment portfolios.
This contrast is likely attributed to a confusion about the wide range of SRI (Socially Responsible Investment) products on offer by asset managers, says Reyneke Van Wyk, Head of Stonehage Flemings’ Investment Division in South Africa. While respondents demonstrated an increasing interest in SRI, which aims to generate specific social or environmental benefits in addition to financial returns, they also confessed that on a practical level it was not as easy in the traditional investment world to do ‘good’ while also generating benchmark-beating returns for investors.
“Historically, investors have primarily been concerned with the end rather than the means, putting portfolio performance as the primary focus,” said Van Wyk. “However, as was highlighted in our Four Pillars of Capital report, this attitude is changing. For many families and private investors, the gap between investor and investment is closing.”
Considering the variety of socially responsible investing philosophies open to todays’ investors, Stonehage Fleming believes that Environmental, Social and Governance (ESG) investing marries well with a traditional investment management approach and with the long-term investing approach of UHNW* families.
PBI Germany Awards winners announced
Private Banker International’s Germany Awards were announced on Tuesday at a ceremony in Frankfurt. Stonehage Fleming were delighted to win Outstanding Family Office Proposition in Germany.
These awards are an extension of the well established Private Banker International Global Awards that took place in Singapore last year. These awards are designed to identify leading institutions that are setting new standards in private banking and wealth management in Germany. The shortlist of finalists underwent a rigorous selection process and our independent judging panel chose the awards winners.
What Happens When Billionaires' Children Inherit
It is not always about beautiful homes, lush holidays, and expensive educations. When sons and daughters of wealthy families inherit their entitled fortunes, there are often dramatic side effects. And this is causing many-a-billionaire to re-think what they leave behind.
The Real Rich Kids Imagine being given everything you could ever want from a young age. The best education, holidays and homes, then told you never really need to work because your family has more than enough money. A dreamy scenario for some. But there is normally a side effect: wealth robs children of motivation. The more money that is given to children from a young age, the less passion and motivation they have, say wealth advisors. “I’ve worked with next-generation family members who say ‘why go to university, what’s the point?
No one’s going to be impressed with what I do, because my entrepreneurial parents have nailed life,’” says Lucy Birtwistle, a relationship manager at Stonehage Fleming, a multi-family office. Her work often involves meeting with these disenfranchised children and trying to find their purpose and vision. “Each individual needs a purpose, a reason to get up in the morning”.
Fears of an imminent US recession are premature
Recently, the news has been littered with headlines about an inverted yield curve, long seen as a strong indicator of oncoming economic recession in the United States.
The headlines were prompted specifically by the inversion of the 3-month/10-year yield curve. It seems to be too early, on a fundamental basis, to have grave concerns about an imminent US recession, though.
In fact, the 3-month/10-year yield curve only inverted for a few days before returning to a positive reading.
Added to this, a 3-month yield is an unnaturally short maturity to consider in the context of a potential US recession. Historically this curve provided the market with an early warning of, on average, 22-months. That would imply a predicted recession in the first quarter of 2021, if the curve were to invert from here on a sustainable basis, which it shows no signs of doing yet. This does not raise the immediate alarm bells the financial press would have us hear.
UHNW Families go cool on traditional leadership
A survey of wealthy families shows that far more of them would like to choose another way of picking a member who can lead its affairs rather than under the old system of giving the reins to a first-born son.
The traditional primogeniture system is still used by many families particularly as it does at least set out a rule to be followed, possibly removing the need for acrimonious argument. However, many families prefer to adopt a different process, according to a study by Stonehage Fleming, the UK-based multi-family office.
Stonehage Fleming appoints Group Chief Financial Officer
Stonehage Fleming, one of the world’s leading independently owned family offices, announces the appointment of Becton Davis as Group Chief Financial Officer.
With over 20 years’ banking and financial services experience, including 17 years in asset and wealth management, Becton joins Stonehage Fleming from Close Brothers Asset Management (“CBAM”), where he has served as Chief Financial Officer for the past seven years.
Becton’s role is newly created and effective immediately. He is based in Stonehage Fleming’s London office and reports to David Fletcher, Group Finance Director.
The news follows the promotion of Kate Munday from UK Chief Operating Officer to Group Head of HR, which came into effect in November 2018. Having worked in across investment, client servicing and operational departments and IT, Kate has an unparalleled breadth of experience that will serve the Group well in its future growth ambitions. Kate continues to be based in the London office.
Commenting on the appointment, David Fletcher said: “We are very pleased to welcome Becton to this newly created role. He has shown himself to a be an effective CFO with an impressive track record in driving performance to deliver expanding growth. His experience and industry knowledge will help support us as we enter the next phase of the Group’s development and strive to lead the industry as a truly international office.”
Becton Davis said: “It gives me great pleasure to take on this role at such an exciting time in Stonehage Fleming’s journey. I am looking forward to working with my new colleagues to help the Group achieve its financial and strategic objectives.”
The biggest risks facing your high net worth clients
“If you ask high net worth families what the real risks to their wealth might be, they tend to say political or economic risk, but what’s transpired is that the greatest destructor of family wealth is the generational transfer of wealth. The largest proponents of this by far are family dynamics and poor communication,” explains Johan van Zyl, CEO of Stonehage Fleming. “We always start a conversation with clients about the purpose of their family wealth. Some battle with that, but it changes how they manage money.”
Fears of an imminent US recession are premature
Recently, the news has been littered with headlines about an inverted yield curve, long seen as a strong indicator of oncoming economic recession in the United States.
The headlines were prompted specifically by the inversion of the 3-month/10-year yield curve. It seems to be too early, on a fundamental basis, to have grave concerns about an imminent US recession, though.
In fact, the 3-month/10-year yield curve only inverted for a few days before returning to a positive reading.
Added to this, a 3-month yield is an unnaturally short maturity to consider in the context of a potential US recession. Historically this curve provided the market with an early warning of, on average, 22-months. That would imply a predicted recession in the first quarter of 2021, if the curve were to invert from here on a sustainable basis, which it shows no signs of doing yet. This does not raise the immediate alarm bells the financial press would have us hear.
UHNW Families go cool on traditional leadership
A survey of wealthy families shows that far more of them would like to choose another way of picking a member who can lead its affairs rather than under the old system of giving the reins to a first-born son.
The traditional primogeniture system is still used by many families particularly as it does at least set out a rule to be followed, possibly removing the need for acrimonious argument. However, many families prefer to adopt a different process, according to a study by Stonehage Fleming, the UK-based multi-family office.
Stonehage Fleming appoints Group Chief Financial Officer
Stonehage Fleming, one of the world’s leading independently owned family offices, announces the appointment of Becton Davis as Group Chief Financial Officer.
With over 20 years’ banking and financial services experience, including 17 years in asset and wealth management, Becton joins Stonehage Fleming from Close Brothers Asset Management (“CBAM”), where he has served as Chief Financial Officer for the past seven years.
Becton’s role is newly created and effective immediately. He is based in Stonehage Fleming’s London office and reports to David Fletcher, Group Finance Director.
The news follows the promotion of Kate Munday from UK Chief Operating Officer to Group Head of HR, which came into effect in November 2018. Having worked in across investment, client servicing and operational departments and IT, Kate has an unparalleled breadth of experience that will serve the Group well in its future growth ambitions. Kate continues to be based in the London office.
Commenting on the appointment, David Fletcher said: “We are very pleased to welcome Becton to this newly created role. He has shown himself to a be an effective CFO with an impressive track record in driving performance to deliver expanding growth. His experience and industry knowledge will help support us as we enter the next phase of the Group’s development and strive to lead the industry as a truly international office.”
Becton Davis said: “It gives me great pleasure to take on this role at such an exciting time in Stonehage Fleming’s journey. I am looking forward to working with my new colleagues to help the Group achieve its financial and strategic objectives.”
The biggest risks facing your high net worth clients
“If you ask high net worth families what the real risks to their wealth might be, they tend to say political or economic risk, but what’s transpired is that the greatest destructor of family wealth is the generational transfer of wealth. The largest proponents of this by far are family dynamics and poor communication,” explains Johan van Zyl, CEO of Stonehage Fleming. “We always start a conversation with clients about the purpose of their family wealth. Some battle with that, but it changes how they manage money.”
Stonehage Fleming expands wealth planning team with senior hire
Stonehage Fleming, one of the world’s leading independently owned family offices, announces the appointment of Julian Vydelingum as Senior Financial Planner in the Wealth Planning team.
With 15 years’ experience in the financial services industry, Julian joins Stonehage Fleming from AES International where he was an Associate Director based in Dubai. Prior to this, Julian was a Senior Wealth Planner at Killik & Co. Julian is a Chartered Financial Planner and Fellow of the Personal Finance Society.
Julian’s role is effective immediately. He is based in Stonehage Fleming’s London office and reports to Susie Hillier, Head of Wealth Planning.
Commenting on the appointment, Susie Hillier said: “I am very pleased to welcome Julian to our team. His significant experience in financial planning means he can immediately add value to our existing clients.”
“Julian’s appointment comes after the recent hire of Kate Boswell as Director in the Wealth Planning team in January. These appointments demonstrate our commitment to the further expansion and development of our wealth planning offering as we strive to meet the needs of our UK and international client base.”
Julian Vydelingum added: “It gives me great pleasure to be part of the Wealth Planning team at such an exciting time in the Group’s journey. I am looking forward to working with my new colleagues and being part of the next stage of Stonehage Fleming’s growth.”
Trusts, New Swiss Rules & The Wealth Toolbox
The world of trusts, foundations and rules in IFCs are changing constantly. A country where new regulations are coming out, not always under much publicity, is Switzerland. This publication recently spoke to a prominent wealth firm about developments.
A possibly unavoidable aspect of the Brexit drama is how it has dominated the media, business and political attention, leaving important developments in the shade. One such development is the work to shape a new regulatory landscape in Switzerland. The Alpine state’s authorities are shaking up how funds and financial structures are regulated. There are also moves from some quarters to push Switzerland’s credentials as a trusts jurisdiction.
And the market for wealth structures such as trusts and foundations continues to develop, and it also faces pressures from campaigns for ever more transparency around beneficial ownership, for example. At a recent Swiss conference hosted by the Society of Trust and Estates Practitioners, this publication was struck by how concerned industry figures are about assaults on privacy, but also how they think there may be signs that the pendulum could swing the other way.
WealthBriefing recently interviewed Philippe de Salis, head of fiduciary, Switzerland, Stonehage Fleming, about these issues.
Simplifying your wealth structure is primarily about consolidation says South African Director
14 Mar 2019
Simplifying your wealth structure is primarily about consolidation says South African Director
Director within the Stonehage Fleming South African Family Office division, Michael McLeod, says that knowledge of the consequences of these standards is generally low in South African.
“The main attractions of multiple structures are estate and tax planning, succession planning and privacy. In many cases, privacy can still exist without the need for cumbersome structures, while retaining data protection and data security with regards to private wealth,” says McLeod.
“Historically, the motivation behind complex wealth structures for high and ultra-high net worth families was linked to secrecy and tax mitigation. The regulatory environment is becoming increasingly more stringent, which means transparency is non-negotiable and secrecy is not an option.”
McLeod also cautions that many wealthy families’ existing structures no longer serve their original purposes and should be reviewed by a trusted financial partner to ensure that their needs are being met to safeguard family wealth for current and future generations, and the management of family assets.
“Simplifying is primarily about consolidation; a process of combining multiple structures into a single, more coherent whole; an entity that will be the primary vehicle for your family moving forward. In terms of modernisation, a consolidated structure will also prove more cost effective due to the rising administrative and professional costs associated with such structures. If your wealth structure is user-friendly for you, it means it will be user-friendly for the regulator and this knock-on effect is an important consideration.”
Animal healthcare - an opportunity for investors
‘Organic growth potential in the animal healthcare sector exceeds that of human healthcare’ says Gerrit Smit. In this article, Gerri Smit, head of Equity Management (London) at Stonehage Fleming, discusses the low risks of investing in the animal healthcare sector.
Stonehage Fleming expands wealth planning team with senior hire
Stonehage Fleming, one of the world’s leading independently owned family offices, announces the appointment of Julian Vydelingum as Senior Financial Planner in the Wealth Planning team.
With 15 years’ experience in the financial services industry, Julian joins Stonehage Fleming from AES International where he was an Associate Director based in Dubai. Prior to this, Julian was a Senior Wealth Planner at Killik & Co. Julian is a Chartered Financial Planner and Fellow of the Personal Finance Society.
Julian’s role is effective immediately. He is based in Stonehage Fleming’s London office and reports to Susie Hillier, Head of Wealth Planning.
Commenting on the appointment, Susie Hillier said: “I am very pleased to welcome Julian to our team. His significant experience in financial planning means he can immediately add value to our existing clients.”
“Julian’s appointment comes after the recent hire of Kate Boswell as Director in the Wealth Planning team in January. These appointments demonstrate our commitment to the further expansion and development of our wealth planning offering as we strive to meet the needs of our UK and international client base.”
Julian Vydelingum added: “It gives me great pleasure to be part of the Wealth Planning team at such an exciting time in the Group’s journey. I am looking forward to working with my new colleagues and being part of the next stage of Stonehage Fleming’s growth.”
Trusts, New Swiss Rules & The Wealth Toolbox
The world of trusts, foundations and rules in IFCs are changing constantly. A country where new regulations are coming out, not always under much publicity, is Switzerland. This publication recently spoke to a prominent wealth firm about developments.
A possibly unavoidable aspect of the Brexit drama is how it has dominated the media, business and political attention, leaving important developments in the shade. One such development is the work to shape a new regulatory landscape in Switzerland. The Alpine state’s authorities are shaking up how funds and financial structures are regulated. There are also moves from some quarters to push Switzerland’s credentials as a trusts jurisdiction.
And the market for wealth structures such as trusts and foundations continues to develop, and it also faces pressures from campaigns for ever more transparency around beneficial ownership, for example. At a recent Swiss conference hosted by the Society of Trust and Estates Practitioners, this publication was struck by how concerned industry figures are about assaults on privacy, but also how they think there may be signs that the pendulum could swing the other way.
WealthBriefing recently interviewed Philippe de Salis, head of fiduciary, Switzerland, Stonehage Fleming, about these issues.
Simplifying your wealth structure is primarily about consolidation says South African Director
Director within the Stonehage Fleming South African Family Office division, Michael McLeod, says that knowledge of the consequences of these standards is generally low in South African.
“The main attractions of multiple structures are estate and tax planning, succession planning and privacy. In many cases, privacy can still exist without the need for cumbersome structures, while retaining data protection and data security with regards to private wealth,” says McLeod.
“Historically, the motivation behind complex wealth structures for high and ultra-high net worth families was linked to secrecy and tax mitigation. The regulatory environment is becoming increasingly more stringent, which means transparency is non-negotiable and secrecy is not an option.”
McLeod also cautions that many wealthy families’ existing structures no longer serve their original purposes and should be reviewed by a trusted financial partner to ensure that their needs are being met to safeguard family wealth for current and future generations, and the management of family assets.
“Simplifying is primarily about consolidation; a process of combining multiple structures into a single, more coherent whole; an entity that will be the primary vehicle for your family moving forward. In terms of modernisation, a consolidated structure will also prove more cost effective due to the rising administrative and professional costs associated with such structures. If your wealth structure is user-friendly for you, it means it will be user-friendly for the regulator and this knock-on effect is an important consideration.”
Animal healthcare - an opportunity for investors
‘Organic growth potential in the animal healthcare sector exceeds that of human healthcare’ says Gerrit Smit. In this article, Gerri Smit, head of Equity Management (London) at Stonehage Fleming, discusses the low risks of investing in the animal healthcare sector.