According to a study, second-generation family members currently run nearly two-thirds (62%) of single-family offices in the Middle East, which are the organizations set up by multigenerational business-owning families to manage their affairs.
The study conducted by LGT Middle East and the Tharawat Family Business Forum highlights the significant change that is taking place as family heads start involving their next generation of relatives. According to the study, next-generation family members make contributions and investment decisions in 41% of single-family offices. Results also show that third-generation family members make investment decisions in 35% of family offices. The study report stated that 88% of respondents cited succession planning as a crucial factor, second only to centralizing family investments and managing financial risk. This reflects the future-focused nature of the reason these family office structures were first established. This research indicates that the massive generational transfer of wealth in the Middle East is well underway. It is the first comprehensive analysis of the region’s rapidly expanding family office landscape. Establishing strong governance structures will be the defining success factor for family offices as they transfer their assets to the next generation.
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