Baseball’s philosopher-king, Yogi Berra, said it best: “It’s tough to make predictions, especially about the future.”
The world is moving fast and change is inevitable. Some changes will be good for us and some won’t. Families rightly wonder how they will fare, what they should embrace, how they should adapt, and how they should prepare themselves.
There are no silver-bullet answers to questions like these. A good place to start when considering the future is the core values of the family. It might be worthwhile to skip back to the questions raised in Section 1 of this book – Thinking Through What Matters Most – to remind yourself about the fundamental beliefs and principles that could be a source of stability and constancy through whatever is to come.
But it is also important for families of wealth to consider the global trends that may affect them, as well as the potential shifts within their own families and communities. The authors in this section offer some interesting food for thought on these topics.
James Hughes looks at the question “What does the future hold for families of wealth?” from his long experience and unique perspective. He sees many changes on the horizon, including the definition of family itself, new types of family leadership that will be required, and the increasing importance of female leadership and wealth ownership. He also considers the impact of China on everything and everyone, and the implications of having most family assets in a trust structure.
Fernando del Pino writes a thoughtful personal answer to the question “How can you chart your own path, no matter what everyone else says you should do?” from the standpoint of an inheritor and a wealth owner. He addresses many tricky subjects – including parental favoritism, the danger of advisors, the fading notion of owners, and the burdens and responsibilities of wealth – and provides wise counsel for founders and heirs alike as they look to the future.
James Grubman also weighs in with his advice on how wealthy families should face the many challenges of the future, both within and across generations, and ultimately how they can maintain both stability and resilience in the face of a rapidly evolving world. Navigating the challenges with a resilient, adaptive attitude is one of the strongest contributors to long-term family harmony and prosperity.
Finally, we conclude this section by reprinting a condensed version of a 2015 speech entitled “Lifting the Small Boats” by International Monetary Fund (IMF) Managing Director Christine Lagarde, with her kind permission. In her remarks, she comments on one of the key issues in today’s (and tomorrow’s) world – global economic inequality – and the related instability and disequilibrium it can bring. This has been an enormously prosperous period for global families of wealth. Other global (and local) citizens have felt left out of the prosperity wave and believe the system is rigged and unfair. From her unique vantage point, Christine raises issues and ideas for policymakers and families of wealth and power to consider about how we might make sure the “small boats” – the livelihoods and economic aspirations of the poor and middle class – are lifted too, for the benefit of all. Food for thought.
No doubt one of the most dangerous sentences in the world of business and investments is “It’s different this time.” Facing the future means being clear-sighted about the present and the past. That said, conditions do change, and that can require revised strategies – even if the goal is to maintain what was. In this respect, families with long-term vision may even resemble small nations, of which the medieval political philosopher Al-Farabi wrote, “The second lawgiver must legislate differently than the first lawgiver – if he is to do the same thing.” Tradition itself springs from and relies upon innovation.
Chapter 50 – What Does the Future Hold for Families with Significant Wealth?
Chapter 51 – How Can You Chart Your Own Path, No Matter What Everyone Else Says You Should Do?
Fernando del Pino
Chapter 52 – How Do You Balance Family Stability with Resilience Over the Generations?
Chapter 53 – How Can We “Lift the Small Boats” Too?