The single most striking finding of the 2023 Four Pillars of Capital survey is the major shift in the biggest risks that families and wealth creators identify to their long-term prosperity. For the first time since we began the Four Pillars of Capital surveys in 2015, the investment environment and political risk make up two of the top three threats to the preservation of wealth that families see ahead.
For the first time in a decade, respondents identify poor investment outcomes and political risk as two of the top three challenges to sustaining family wealth.
Failure to engage the Next Generation appropriately - a perennial concern - completes the trio.
A majority of respondents do not trust the political and institutional leadership in their jurisdictions.
Only 20% of respondents have a formal process for identifying and mitigating risks.
The Stonehage Fleming View
A renewed focus on financial capital is not surprising given the resurgence in economic and political volatility.
A sustainable strategy should not neglect the social, intellectual and cultural pillars, however, since these are equally critical to long-term success.
Deploying a simple but rigorous process for risk appraisal is more important than ever in today’s Age of Upheaval.
Managing risk may not be a topic that generates excitement, but it is vital to intergenerational success.
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