No one can ignore the drive for change taking place around us. Across the globe, millions of young people have taken to the streets to increase awareness about global warming. Consumers are demanding more sustainable products.
Banks, including wealth managers, are also facing winds of change. The next generation of clients, with their need, desire and drive to make a difference, look set to bring to the wealth management industry the disruption that technology has yet to trigger.
Wealth management teams have something of an advantage in that they stand alongside what could arguably be the secret of their own future, and potentially the answer to the future of capitalism: family dynamics.
The role of the family within society
Families are not only the smallest entity in society but are also the first with which we enter into contact. Within this smallest of microcosms, we learn from the get-go the basics of how to communicate and how to find solutions based on an understanding of different needs and respect of differing views.
The skills learnt within the family to strive for a common goal (the wellbeing of the group) arm us with tools to use in the broader world, both professional and personal. But what are the secrets of successful family dynamics?
The key to a family's success
Recently, I spoke with two heirs of the Rockefeller dynasty. The Rockefeller family boasts many notable achievements in the areas of entrepreneurialism and philanthropy across more than 100 years, and most recently in impact investing.
They explained the key to their family's success – now in its sixth generation – and how dialogue and sharing the same long-term goals took much work but brought its fruits. They also talked of how their family had to strengthen personal relationships with one another in an effort to preserve these important values and traditions.
That meant – and still means – spending a lot of time together and engaging in many conversations, for example at the twice-yearly family meetings where more than 300 Rockefellers reunite.
The unity and sense of belonging driving this family's continued success can be linked directly to why family businesses have a history of accomplishment. Credit Suisse has issued "Family 1000" reports for a number of years looking into why family businesses have consistently outperformed their non-family-run peers.
The lessons learned from these reports, looking at 1,000 listed family businesses, indicate that family-run businesses are more successful than their non-family counterparts partially because they focus more on their long-term goals rather than short-term wins, in comparison to their non-family competitors.