New | Family offices flourish as China’s ultra-rich strive to preserve their wealth for generations
Chinese magnates are setting up firms to help manage their family fortune and pass it down to their children and relatives
More of China’s very wealthy – many of them self-made billionaires – are starting family offices as they chart their succession plans to pass on their accumulated assets to their offspring amid increasing uncertainty in the country’s financial market.
“China’s magnates are worried whether they can preserve their wealth down to two or three generations,” said Andrew Yen, founder of the Shenzhen-based Fusion Family Office.
The Chinese saying that “wealth does not pass three generations” is just what has the rich worried, many of them entrepreneurs who have spent much of their lives building up their wealth and businesses. And that’s what has them turning to family offices, Yen said.
Yen’s company helps the ultra-rich set up and run their family offices. A family office refers to an organisation run by and for a family, which centralises the management of a significant family fortune with the aim of transferring the wealth across generations. Typically, such entities have employees to manage investments, taxes, trusts and legal matters.
Especially over the last two years, Yen has seen mounting concerns among China’s ultra-rich because of economic headwinds, he said, citing the recent A-share market rout as their latest cause for alarm.
