Wealthy American families see themselves as public role models and want to give their wealth a new purpose, according to a new study.
“More of the world’s wealthy families are exploring how they can use their private capital to positively influence the social and economic challenges they see around them,” said Withers Bergman partner Justin Zamparelli. “Families are finding that active participation is much more beneficial for the family and for society than a passive approach to investing or giving.”
The study, The Meaning of Wealth in the 21st Century, was commissioned by the law firm Withers Bergman and research partner Scorpio Partnership and involved interviews with the heads of 16 rich families in Asia, Europe and North America, and data accumulated online from 4,500 additional millionaires over the past two years.
Six of those interviewed were rich families in the U.S., including two billionaires.
Because of their assets, according to the report, wealthy U.S. families often feel like public figures that should lead by example.
“These individuals get involved with good causes often, quite simply, because they can and they want to. However, many also regard giving a portion of their fortune to make a difference in the world as one of the chief responsibilities of wealth ownership,” the report says.
But there is also a flip side to being a high-profile investor.
“This can be good and bad – it means that they try to lead by example, but also means that any actions regarded as negative are likely to be highlighted,” Zamparelli said.
This also applies to the positions of the leaders within each family. As a family’s lead decision-maker, the head of the family should ensure that their actions encourage the other members of the family to act in ways that are beneficial to the group, according to the report.
“When a new generation is called upon to take ownership of the family wealth, there is a potential for it to unravel, as the younger family members bring their own values and interests to bear,” Catherine Tillotson of Scorpio Partnership. “Anything that creates coherence and harmony is valuable, and these days it appears to be the social application of wealth.”
