How a new generation of sports and entertainment stars are changing the narrative when it comes to wealth
Markets and Investments, Family Governance and Education
Currently, one could easily argue the perception of wealth and the wealthy around the world is more negative than positive. But we see a change on the horizon.
How the rich are viewed depends to a large degree on local cultural norms, religious beliefs, economic histories, and the political systems. Sociologist Rainer Zitelmann surveyed over 10,000 people across Asia, Europe, and the United States and found people express admiration for the wealthy, attributing traits such as intelligent, daring and visionary. But more frequently, people express envy and ascribe negative characteristics such as self-centered, materialistic, ruthless, and greedy. Negative perceptions and stereotypes regarding wealth and the wealthy seem to persist around the world as more common and pernicious than positive ones.
Before the internet, we contrasted our financial status to that of our neighbors. Today, with access to social media and global connectivity in our pockets, we see constant images of huge homes, fancy cars, luxurious vacations, and seemingly endless material possessions. Instead of comparing our finances with that of our neighbors we are inundated with highly curated reminders of financial inequality. Theodore Roosevelt’s quote “comparison is the thief of joy” is confirmed in a recent Yale study which found a key factor in well-being is our perception of wealth and status relative to others.
While technology is increasing feelings of envy, often to a toxic level, the gap between the “haves” and the “have-nots” has been increasing at a staggering rate which only adds to the negativity. Globally, the wealthiest 10% in 2021 held over 75% of the world’s wealth1. History shows that when financial inequality grows, so do the negative perceptions of wealth. This rarely leads to a positive long-term result. To the contrary, it tends to result in economic downturn, social unrest, and political restructuring.
But… not all hope is lost.
Many of the rising generation of wealth holders have taken a regenerative perspective focused on using resources for public good. In fact, over 60% of millennials from across the wealth spectrum define themselves as philanthropists2. The humanitarian crises around the world have galvanized many to give generously and support those in need, showing in real time how wealth can be used to help others. The world appears united in concern about the health and future of our planet and our communities. Impact investing, including philanthropy, is on the rise, raising public awareness of the positive change intentional allocation of capital can make in the world. Many are aware of The Giving Pledge campaign, founded by Bill Gates and Warren Buffett, which has had great success in encouraging billionaires to make the world better by committing to give the majority of their wealth to philanthropy either during their lifetimes or in their wills. Money combined with positive intent can be very powerful and an agent of change for the better.
We see wealth creators and inheritors focusing on the triple bottom line – on people, planet, and profits. Many of today’s wealth holders expect their wealth to do more than grow. They expect it to also create extra-financial value in the world. The following are a few examples across our global client base that highlight this trend and give us optimism about the future.
Client Commitment to Sustainability
Our client is a 5th generation owner of a significant family enterprise in Europe. Though raised with significant financial resources, he could not be more opposite than the stereotypical trust fund baby. He has dedicated his life to conservation, sustainability, and equality. After college, he launched an institute dedicated to exploring how capital impacts human prosperity. He collaborates with governments, financial institutions, and corporations around the world to advance policy decisions that drive systemic change in society. Having grown up in Australia, he has a deep passion for the ocean and hosts a podcast focused on supporting life under water. He serves on multiple non-profit and for-profit boards striving to help the human economy operate within the Earth’s ecological limits.
His passion and commitment to making the world a better place is helping our wealth management business push the boundaries of what it means to invest with impact. He is activating his financial and human capital to achieve positive environmental, societal, and spiritual capital returns. His measure of success cannot be found in a financial benchmark. And he is helping other rising generation inheritors grapple effectively with growing up in the shadow of someone else’s financial success.
Billionaire Couple Inspired by their Children
After selling their business for multiple billions of dollars, a couple living in Singapore struggled with the reality of their recently liquidated wealth. Growing up in poor households, they committed to giving their children a better life. They both worked 100-hour weeks for 60 years. Before the sale, they were financially comfortable but never considered themselves rich, let alone billionaires. They were filled with fear about how the money would impact them, their children, and future generations. They struggled with if, when and how to talk to their three adult children about their financial success. Although the couple described their children as responsible, caring and overall “really good kids” -- they worried.
Somewhat begrudgingly, the couple agreed to allow us to facilitate a family meeting to begin the journey of engagement and education.
We had pre-meeting conversations with each of the children and their spouses. Their son started the conversation by saying, “I am glad we are having this meeting. I am worried about my dad’s health and happiness. I have been begging him to come volunteer on a Sunday with his grandkids at the youth organization I run but he declines.”
Their oldest daughter, a social worker, and her surgeon husband raised similar concerns. They shared they were busy pursuing their careers but try to check in often on their mom and dad. She said, “You know… that business was everything to them. And now they seem lost.”
The youngest daughter was the only one that said anything about the money. She expressed that it felt odd to read about the business sale in the paper rather than hear about it directly from her parents. Her friends asked her what it felt like to be a billionaire. She said, “I wish my folks would enjoy it. I mean they worked so hard and will not even fly first class. I do not want the money. Maybe we can do something for the community as a family. We all have deep roots here and people are suffering.”
At the start of the family meeting the children shared these sentiments with their parents. You could almost feel all their fears evaporate as the dad exhaled and got choked up. By the end of the meeting, they committed to being open and vulnerable with each other about the money and their relationship and they decided to launch a Family Foundation, led by the youngest daughter and her dad, to make individual and shared decisions about grants to the community.
Hope for the Future
These are just two examples out of hundreds of experiences with clients around the world.
Our experience working with wealthy individuals around the world does not align with negative stereotypes.
There is a changing paradigm around the definition of “returns”. Many wealth holders want their financial assets to grow but also strive for investments to have a positive impact on their family, on humanity, society, the planet, and our spirits. If not for us, then for future generations.
As more wealth holders engage in regenerative activities focused on net positive impact, we believe our attitudes, biases, and stereotypes will follow!
Jill Shipley is AlTi’s Head of Governance and Education Practice. She helps families and family enterprises navigate the impact of multigenerational wealth. She brings over 20 years’ experience in family systems, preparing rising generations, communicating about wealth, transition planning, governance, and philanthropy.
Markets and Investments, Family Governance and Education
By Nancy Curtin
Markets and Investments
By Nancy Curtin
Markets and Investments
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