© 2018 Stonehage Fleming


Our first research paper ‘Four Pillars of Capital for the 21st Century’, was published in 2015. Drawing on insights and data gathered from clients and friends of our firm, it proposed that a family’s social, intellectual and cultural capital were as important to its long-term, intergenerational health as its financial capital.

Our subsequent paper, published in 2018, highlighted practical considerations from further research within the Four Pillars framework, including the challenges of leadership and succession, the importance of a considered approach to risk identification and mitigation, the increasing desire of families to demonstrate their values through their financial decisions, and the invaluable nature of a family’s brand and reputation. Further information about the key themes can be found below.

‘Four Pillars of Capital: a time for reflection’, published in 2020, is a shorter paper which seeks to show if and how the pandemic has affected family attitudes and priorities, and whether the extraordinary events of 2020 will have a longer term impact on how families go about securing intergenerational success.

Four Pillars

The tangible assets, business, properties, investments and intellectual property of a family which have quantifiable financial value.

That which brings a family together by identifying shared perspectives and themes in the way its members conduct their lives. This includes their approach to business, treatment of others, contribution to society, attitude to wealth and their values.

The accumulated skill, knowledge, experience and wisdom a family can apply to the management of its wealth, its contribution to society, the individual fulfilment of its members and its collective wellbeing.

The way in which a family relates to and engages with society and the communities in which it lives and operates. This includes the network of contacts which help a family to use its wealth and other assets to the benefit of society and/or the good of the family.


'Four Pillars of Capital for the Twenty First Century: The Next Chapter - Practical Wisdom and Leadership for Changing Times' is the third report in our research series which outlines the challenges in the transfer of wealth across generations, and analyses how the rapid pace of change is affecting the way families prepare for the future.

The report contains information gathered from a survey, interviews and workshops conducted with some 150 multigenerational members of different families and their trusted advisers. Four key themes emerged from the findings:



Having the right leadership model in place is essential to see a family through the uncertainties of a changing environment and ensure the safe transition of wealth from one generation to the next, if that is their agreed purpose.

An effective leadership model enables a family to manage all risks, both internal and external, with an individual or individuals with the skills to address every aspect of a family’s capital.

There is no right or wrong way to appoint new leaders within a family. A democratic system, where leaders are appointed for their role-specific skills, will equip a family to cover off the full spectrum of risks. Families should not be afraid to look externally in the absence of a suitable internal candidate, also for counsel and facilitation of the process.

Structured preparation for leadership is essential. Effective training should nurture people’s natural aptitudes and give them enough autonomy to find their own voice and role within the family structure.

Once the right leadership model is in place, strong communication is essential to ensure that all leaders and the wider family are kept abreast of the family objectives and the proposed strategy to achieve them.

Primogeniture is on the wane "There is real evidence of a shift - a definite trend towards a meritocracy and towards new methods of choosing family leaders", said Matthew Fleming Read More »



Effective risk management can be grouped into internal and external risks both of which should be assessed and measured with reference to each of the Four Pillars.

This, by definition means not focusing purely on external financial and economic risks but also managing internal family issues around intergenerational planning, educating the next generation, building the right leadership team and preserving a family’s reputation.

The same rigour that is applied to managing and planning for financial risks should be applied to other family risks, with similar processes for measuring, recording and managing them.

Value Vs. Values


Establishing what you stand for as a family is not easy, but without doing so, setting meaningful objectives and engendering a sense of shared values won’t be possible.

For some, drawing up a formal family constitution cements the internal ethos in the minds of all family members and will help the leadership team motivate the family to meet their objectives including training the next generation.

Communication is key. Digital technology has brought many new ways to communicate a family ethos. Millennials and Generation Z are widely considered to have a more acute social conscience than previous generations, putting environmental sustainability, social and gender equality firmly on the agenda. One of the consequences will be the wider spread adoption of socially responsible investments.

Seeing through the greenwash "Take a closer look to reveal real sustainability" - Mona Shah, Director - Investment Strategy & Research Read More »

Reputation and Contribution


There is an opportunity for families to take control of their own narrative - about the good they do. Contribution to society is often the natural outcome of a family’s activities. Active philanthropy though is a different matter. It is down to individual taste as to whether a family wants to tell others the story of their philanthropic projects.

Reputation is increasingly difficult to manage in the always-on age of social media and a family has to be aware of its brand, externally. At the same time, families have to manage the expectation of transparency in business and financial dealings from the wider public and the press. A clear reputation strategy is a huge advantage. One way to achieve this is to retain an external adviser to put it together, though, authenticity will always trump PR.

A rapidly-changing society has increased the awareness of a need for a more structured approach to managing intergenerational risk and the use of process in doing so. The right leadership structure is the only reliable protection against unforeseeable threats, both internal and external.


This paper was co-authored by the following Stonehage Fleming colleagues.

Our thanks also to Montfort Communications for their support with various aspects of the project.

Fore more information, please contact

Guy Hudson

Partner - Head of Group Marketing
Email Guy Hudson


Matthew Fleming

Partner - Head of Family Governance & Succession
Email Matthew Fleming


Kitty Tait

Director of Content - Group Marketing
Email Kitty Tait



This is our third report in the research series.

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