Wealthy women seek advisers with eye on bigger picture
There are more female billionaires than ever before, with Asian entrepreneurs the big driver. But these women require a different approach from private banks than their male counterparts
Across the world, the faster growth of female billionaires over their male counterparts is indicative of how women in the recent past have emerged not only as business pioneers, but also promoters of family and firm governance, as well as drivers of philanthropic legacies.
According to a UBS/PwC study, numbers of female billionaires have grown nearly seven-fold over the last two decades, in comparison to just over five times for men, albeit from a smaller base. There are 145 women billionaires today versus 1,202 male billionaires.
Asian female entrepreneurs have been the main driver of this development, according to the study, which surveyed more than 1,300 people in 14 countries, accounting for 75 per cent of global billionaire wealth.
More than half of Asia’s 25 female billionaires are first-generation entrepreneurs. In Europe and the US, however, wealth is mostly multi-generational (93 per cent and 81 per cent respectively). Western women billionaires have mostly inherited wealth, ‘married into wealth’ or created businesses together with their husbands. Asian ultra-wealthy women tend to be younger than their Western peers, aged 53 on average, compared to 59 in the US and 65 in Europe.
Female billionaires share the same personal traits as male billionaires. These include smart risk taking, obsessive business focus and dogged determination, “undeterred by failures and roadblocks and supported by a tremendous work ethic”, according to the survey.
But what they require is a different service approach from private banks. “Women billionaires are as big risk takers, as focused and determined as male billionaires but our dialogue with them is completely different,” says Josef Stadler, head of global ultra high net worth at UBS Wealth Management.
“Women have a big picture in mind far more often than gentlemen,” says Mara Harvey, who heads business and client development for ultra high net worth clients across Europe at the global bank.
“They tend not to jump straight to the point, into how they can maximise their investment opportunity on their liquid assets, but rather prefer to have a discussion on the purpose of their wealth, and what role the liquid part of the investment plays into achieving those goals.”
Findings from a separate UBS survey on a dozen women billionaires in Europe showed what they really value is the ability to choose their private bankers.
“Women are extremely vocal about the fact they want to choose the person they entrust their money to, and they were telling us ‘it is like choosing a nanny’,” reports Ms Harvey. “The nanny is the most crucial part of your life, if you want to be a successful business woman.”
UBS Wealth Management claims to serve more than 55 per cent of the world’s billionaires and more than 75 per cent of Asian billionaires. The billionaire cohort accounts for one third to half of net new money at UBS Wealth Management.
The global private bank has the ambitious target of banking 10 per cent of every billionaire’s bankable assets. JP Morgan, followed by Credit Suisse, Goldman Sachs, and, in certain markets, Deutsche Bank are seen as key competitors in this space.
“Billionaires are very attractive clients because when they move, they move big, and this is a very scalable business,” states Mr Stadler.
Fleeting wealth
Great wealth is very volatile, according to the UBS/PwC study, as only 44 per cent (126) of 1995’s 289 billionaires remain today. The others have dropped off the billionaire list due to death, family dilution or business failures. Over the same period, 1221 new billionaires were created, bringing the total number to 1347.
Consumer and retail, technology and financial services are the dominant industries, making up two-thirds of the total wealth of today’s billionaires.
Those billionaires who lasted the course have greatly increased their wealth, growing average net worth to $11bn from $2.9bn in 1995, outperforming both equity markets and global GDP growth.
The total wealth they created, around $1tn, is 21 per cent of that produced by the entire observed global billionaire population over the period, amounting to $5.4tn.
