The head of the recently established Coutts
Institute in Asia has emphasised the importance of succession
planning for family businesses as part of a holistic approach to
wealth management.
Roger Low said many family businesses in
Asia are first-generation and second-generation operations, which
created many succession issues.
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“Many Asian family businesses do not plan
about succession because they assume the children will take over
the business,” said Low.
“[However], In Europe and the West in general,
the larger family businesses tend to be family-governed family
businesses where they leave a lot to the professional
managers.”
Asian initiative follows London,
Zurich lead
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By GlobalDataThe Coutts institute in Asia was established
in early 2011 and offers wealth advisory services for
high-net-worth (HNW) and ultra HNW clients on family business
advisory, philanthropy advisory and next generation services.
Low explained that a key issue for family
businesses in Asia related to succession
and how families developed human and social
capital.
Human capital looks at whether the
successor has the skill set to do the job competently, while social
capital refers to transferring the business relationships and
goodwill to the successor, explained Low.
“Next generation successors tend to ask about
the implications of joining the family business and what to do if
they are not interested,” noted Low.
The Coutts Institute in Asia follows the
roll-out of similar initiatives in London in 2005 and in
Zurich in 2010.
