Wealth Adviser Newsletter

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NEWSLETTER | 23 Oct 2020

Wealth preservation: UHNWIs have family fortune concerns

Even very wealthy families are not immune to the financial concerns brought on by the coronavirus pandemic it seems, with a new survey by Campden Wealth, commissioned by RBC Wealth Management, revealing that the loss of the family fortune is a major concern for ultra high net worth Individuals (UHNWIs).

The survey, which reflects the views of over 100 next generation inheritors in the US, Canada and the UK, with an average family fortune of close to USD1 billion, found that over half worry that they will lose the wealth their family has created, while 44 per cent are concerned that their children will lose it. And with an estimated USD15 trillion in global wealth set to transition to a new generation by 2030, there's plenty at stake.

“Ultra-high net worth inheritors are not immune to the changing global landscape and the issues associated with it,” says Ross Jennings, Head of Sales & Relationship Management with RBC Wealth Management. “The ongoing generational wealth transfer places an additional need to ensure they can protect and grow their wealth for future generations while focusing on their interest in driving social and environmental change.”

Despite the challenges ahead though, UHNWs remain committed to ESG investment, according to a report from Stonehage Fleming based on a survey of 183 multigenerational members of different families and advisers.

Graham Wainer, CEO and Head of Investments at Stonehage Fleming Investment Management, says: “We are very confident that values-based investing can enhance returns, and are happy, but not surprised, to see that clients’ remain committed to ESG even during times of extreme market uncertainty.”

Bancroft Wealth though, warns that all investors should be wary of 'greenwashing' when making ESG investment choices, and that not all ethical investments are equal.

“When you look under the bonnet, a lot of so-called ethical funds look very similar to other funds, so there is a real risk that much of the time it is simply a branding exercise," says Keir Ashman, pensions and investments specialist at Bancroft Wealth.

With interest in ESG investments on the up, Aviva Investors this week launched a new training programme aimed at helping financial advisers stay ahead of the curve. ESG: Know How’ is an online, interactive, CPD-accredited training programme aimed at helping financial advisers prepare for the regulatory changes being introduced from early 2021 which will make it mandatory for firms to include questions on ESG investing as part of their suitability process with clients.

We also have two guest features this week which look at the advantages (tax and otherwise) of specific investment opportunities – the unlisted business relief (BR) market (Matt Dickens, Senior Business Development Director at Ingenious), and VCTs or venture capital trusts (Jack Rose, Triple Point).

Wealth Adviser

Over half of next generation wealth holders are concerned they will lose their family fortunes, says survey

Thu | 22 Oct 2020, 15:35

While financial security is on the minds of people across the income spectrum, a new survey reveals wealthy individuals are not immune to financial concerns, although their challenges are unique to their demographic.

Thu | 22 Oct 2020, 15:35

New research from international family office Stonehage Fleming has found that ultra-high net worth (UHNW) families have remained committed to ESG investment, despite the impact of Covid-19.

Thu | 22 Oct 2020, 15:35

Following many years of increasing demand for ethical investments, flat-fee wealth manager Bancroft Wealth is warning investors to look beyond the labels and marketing messages when choosing where to place their money if they want both ROI and ROP (return on investment and return on principles).

Thu | 22 Oct 2020, 15:35

Aviva Investors has launched ‘ESG: Know How’, an initiative designed to meet the rising demand for better adviser knowledge of environmental, social and governance (ESG) investing. ‘

Thu | 22 Oct 2020, 15:35

By Matt Dickens, Senior Business Development Director at Ingenious – Financial planners and wealth managers should of course be striving to deliver on the needs and circumstances of specific clients with the most suitable and effective advice. But as with any service, this must be delivered at the best possible value for the investor. Value can be simplistically defined as the service that delivers the most at the lowest financial cost, but in the estate planning space, how do you assess what good value is?

In an economic downturn, VCTs offer investors a range of advantages

Thu | 22 Oct 2020, 15:35

By Jack Rose, Triple Point – With the economic uncertainty prompted by Covid-19 likely to continue into the foreseeable future, one of the few certainties is that companies need to have a high-quality product or service, be adaptable, well capitalised and led by an outstanding management team. In doing so, they will ensure they are better placed to deal with the ongoing and varied challenges of the economic crisis as well as offering investors value in a turbulent market.

Global ETF launches 15-22.10.20

Thu | 22 Oct 2020, 15:35

In a fairly quiet week for ETF launches, ESG and sustainable investing took centre stage with the launch of two fixed-income funds from State Street Global Advisors and a new iShares ETF from BlackRock. Elsewhere, NextFins debuted the Nifty India Financials ETF (INDF) on the New York stock exchange (NYSE) while ProShares launched a new fund which aims to benefit from transformational changes accelerated by Covid-19.