More women bil­lion­aires than men; only 44% from 1995 still rich to­day

Financial Mirror (Cyprus) - - FRONT PAGE -

The num­ber of fe­male bil­lion­aires is grow­ing faster than the num­ber of their male coun­ter­parts, ac­cord­ing to a UBS/PwC re­port that showed that women have been con­trol­ling greater av­er­age wealth than men and be­com­ing more in­flu­en­tial in fam­ily busi­nesses, phil­an­thropic en­ter­prises and gov­er­nance.

The re­port also high­lights the fleet­ing na­ture of great wealth, find­ing that only 126 bil­lion­aires or 44% of the class of 1995 are bil­lion­aires to­day and un­der­scores the strate­gies th­ese pre­vail­ing bil­lion­aires have em­ployed to build and pre­serve last­ing le­ga­cies.

The sur­vey of over 1,300 bil­lion­aires at www.ubs.com/bil­lion­aires analy­ses data from the last 19 years across the 14 largest bil­lion­aire mar­kets, ac­count­ing for 75% of global bil­lion­aire wealth.

Dubbed, the ‘Athena’ fac­tor, the re­port found that the num­ber of fe­male bil­lion­aires is grow­ing faster than male bil­lion­aires – mul­ti­ply­ing by 6.6x over the last two decades com­pared to 5.2x for men, with Asian fe­male en­trepreneurs stand­ing out as the main driver of this de­vel­op­ment. Asia has seen the strong­est growth of fe­male bil­lion­aires in the past ten years, their num­bers grow­ing by a fac­tor of 8.8 from only 3 to 25 to­day. This com­pares to a growth fac­tor of 2.7 (from 21 to 57) in Europe and 1.7 or 37 to 63 in the US.

Fe­male bil­lion­aires in Asia make up al­most a fifth of the world­wide fe­male bil­lion­aire pop­u­la­tion and gen­er­ally are younger than their global coun­ter­parts. By con­trast, in Europe and Amer­ica, fe­males are mostly multi-gen­er­a­tional bil­lion­aires (93% Europe, 81% US); how­ever, they are also play­ing much stronger roles than pre­vi­ous gen­er­a­tions within their fam­i­lies.

The re­port shows that ‘great wealth’ is very volatile, with more than half of the bil­lion­aires of 1995 drop­ping out of the list over the last 20 years. But those who pre­vailed greatly in­creased their wealth. Con­sumer and Retail, Tech­nol­ogy, and Fi­nan­cial Ser­vices are the dom­i­nant in­dus­tries, mak­ing up for two-thirds of the to­tal wealth of the last­ing bil­lion­aires to­day. The Tech­nol­ogy sec­tor in par­tic­u­lar is home to the most en­dur­ing bil­lion­aires while In­dus­tri­als, Real Es­tate and Health In­dus­tries are sec­tors where bil­lion­aire wealth is more fleet­ing.

In 1995, the re­port counted 289 bil­lion­aires. From this group of bil­lion­aires, only 126 re­main to­day, while the oth­ers have dropped off the bil­lion­aire list due to death, fam­ily di­lu­tion or busi­ness fail­ures. Over the same pe­riod, 1,221 new bil­lion­aires were cre­ated bring­ing the to­tal num­ber to 1347 bil­lion­aires in 2014.

The 126 pre­vail­ing bil­lion­aires have cre­ated US$1 trln of wealth, ap­prox­i­mately 21% of that pro­duced by the en­tire global bil­lion­aire pop­u­la­tion over the pe­riod. By 2014, the av­er­age wealth of the re­main­ing bil­lion­aires had grown their av­er­age wealth to $11 bln from $2.9 bln in 1995, mul­ti­ply­ing their as­sets by a fac­tor of 3.8 and out­per­form­ing global GDP growth of just 2.5.

The UBS/PwC re­search and anal­y­sis con­sis­tently iden­ti­fied three per­son­al­ity traits as es­sen­tial to en­tre­pre­neur­ial suc­cess for both gen­ders – smart risk tak­ing, ‘ob­ses­sive’ busi­ness fo­cus and dogged de­ter­mi­na­tion.

The re­port found that the ma­jor­ity of multi-gen­er­a­tional bil­lion­aires cre­ated last­ing le­ga­cies by keep­ing the ini­tial busi­ness en­tirely or parts of it. The in­dus­try sec­tor of­ten dic­tates the de­gree to which one keeps the orig­i­nal busi­ness. For in­stance, the best wealth preser­va­tion strat­egy for bil­lion­aires that made their for­tune in the Con­sumer and Retail sec­tor is to main­tain con­trol of the orig­i­nal busi­ness as a value driver. Fi­nance bil­lion­aires, on the other hand, are best served by a com­bi­na­tion of re­tain­ing the orig­i­nal busi­ness and adopt­ing a hy­brid strat­egy.

Two-thirds of bil­lion­aires are over 60 years of age and face crit­i­cal wealth trans­fer de­ci­sions. Over three quar­ters of cur­rent bil­lion­aires have two or more chil­dren. To avoid wealth di­lu­tion as the next gen­er­a­tion and sub­se­quent gen­er­a­tions grow larger, a clear wealth preser­va­tion strat­egy is re­quired to en­sure the cre­ation of long term last­ing le­ga­cies.

Pro­tect­ing bil­lion­aires’ le­ga­cies also re­quires cop­ing with out­side forces. Anti-wealth sen­ti­ment in pol­i­tics, grow­ing taxes and in­creas­ingly strin­gent global reg­u­la­tions pose the big­gest threats to bil­lion­aires’ wealth, top­ping their list of con­cerns over po­ten­tial eco­nomic crises, and demon­strat­ing the im­por­tance of ro­bust tax and le­gal ca­pa­bil­i­ties to man­age th­ese chal­lenges.

As part of this, the re­port shows that clear gov­er­nance struc­tures are nec­es­sary to pre­serve and grow wealth through fu­ture gen­er­a­tions. To en­sure long-term suc­cess, man­age­rial com­pe­tence must over­ride fam­ily ties; how­ever, main­tain­ing a strong iden­tity has proven ma­te­rial to lon­glast­ing bil­lion­aire fam­ily dy­nas­ties. This, to­gether with es­tab­lish­ing strong gov­er­nance and a well-re­sourced fam­ily of­fice, is a key fac­tor in build­ing last­ing le­ga­cies.

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