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April Headlines

Business Owner Issues

• Entrepreneurship

Family Continuity & Governance

• Coping with Bereavement in a Family Business

Family Education

• Mapping Family Relationships
• Survey of Children Growing Up Wealthy

Family Office Practice Management

• Assessing Fractional Jet Ownership

Industry Trends and Issues

• Housing: Will It Bring Down the Economy?
• Mapping Global Capital Markets
• The Impact of Baby Boomer Retirement in the U.S.

International Trends

• Focus on China and Asia Pacific
• Developments in China and the Global Economy

Investment Planning

• Discussing Energy Infrastructure Investment
• European Survey of ETFs
• Shedding Light on Private Equity
• The Role of Asset-Liability Management in Private Banking

Lifestyle Management

• Guide to Destination Clubs

Managing Risk and Liability Exposure

• Risk and Structured Products
• The Importance of D&O Liability Insurance

Strategic Philanthropy

• Focus on Self-Dealing in Family Foundations

Technology Trends

• Thoughts on I.T. Challenges

 

Business Owner Issues

Entrepreneurship
Two related items explore the state of entrepreneurship in the twenty first century:

• The Global Entrepreneurship Monitor assesses the characteristics of entrepreneurial activity in 42 countries.
  Click here to read the general findings of the 2006 GEM report
  (Follow the directions at the attached link to view this report)

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• What is entrepreneurship, and what do entrepreneurs do? An article by Rebecca Harding examines the key issues, with reference to GEM findings.
  Click here to read the article

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Family Continuity & Governance

Coping with Bereavement in a Family Business
An article in Family Business deals with the difficult issue of the loss of a family member, in the context of succession planning in a family business. Some strong family business leaders may delay succession planning because they cannot picture anyone else in their seat. But, argues the author, drawing on a recent book by Bonnie Brown Hartley, a number of practical questions should be asked to prepare entrepreneurial families for the aftermath of unexpected loss. Also includes thoughts on working through the grief process.

• Click here to read the article

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Family Education

Mapping Family Relationships
Wealth advisors are supposed to take the family dynamic into account with their recommendations. In an article in Wealth Manager, a practitioner describes how he sat down with his elderly parents and captured their recollections and view of life. More than exercising a professional skill, he recommends it as an interesting and moving exercise for other advisors and clients.

• Click here to read the article
• For more information on the genogram, a tool enabling the user to map family relationships and dynamics, visit: http://en.wikipedia.org/wiki/Genogram

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Survey of Children Growing Up Wealthy
Worried about the moral fiber of today’s young and wealthy? Then prepare to be surprised. A survey by PNC Wealth Management indicates children of wealth enjoy a culture that is privileged yet more responsible, hard-working and ambitious than popular stereotypes might suggest.

• Click here to read the article

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Family Office Practice Management

Assessing Fractional Jet Ownership
Family offices are increasingly selecting business aviation as their preferred air travel solution, and the choices available have never been greater. A paper by Bombardier Flexjet examines the pros and cons of fractional jet ownership. Includes a look at contractual agreements, cost categories and other issues to consider.

• Click here to read the article

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Industry Trends & Issues

Housing: Will It Bring Down the Economy?
Islamic financial markets are developing rapidly from perceived exotic niche to financial mainstream. However, supply side capacity constraints have meant that, until recently, few Shari’a-compliant investment products have facilitated access to alternative asset classes. Deutsche Bank has published an academic paper outlining in detail a structure designed to overcome this shortcoming. Its aim: to help broaden the market for such products while setting a benchmark for quality.

• Click here to read the article

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The Impact of Baby Boomer Retirement in the U.S.
The first wave of baby boomers will be eligible for Social Security in 2008. As boomers approach retirement, speculation abounds about the impact of this demographic change on American society, the economy, the workplace and personal finances. A paper by Capgemini examines some of the issues, addressing the questions: What will baby boomer retirement entail? Will it be a boom or a bust? Includes thoughts on segmenting boomers as well as a description of changing attitudes, expectations and consumption patterns.

• Click here to read the article

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Mapping Global Capital Markets
The stock of global financial markets soared during 2005, reaching $140 trillion, or more than three times global GDP, according to the McKinsey Global Institute’s third annual update on the performance of global capital markets. Other developments: the eurozone financial markets grew to $3.3 trillion; equities accounted for the largest share of growth in financial markets for the third consecutive year; and global cross–border capital flows reached a record $6 trillion. Interestingly, 80 percent of capital flows are still between the United States and Europe.

• Click here to read the article
  (Free registration is required to view this article)

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International Trends

Focus on China and Asia Pacific
Deloitte has published a paper providing insights into wealth management in Asia. After examining high-level market dynamics, it suggests a number of keys to success: understanding customer perceptions and style, understanding regulatory developments, strength in product offerings and talent development and retention programs.

• Click here to read the article

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It now appears that when China sneezes, world markets get a cold. Knowledge@Wharton asks two experts for their views on recent market volatility, which coincided with a sharp decline in China’s stock market index. The discussion focuses on links between developments in China and the global economy.

• Click here to read the article

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Investment Planning

Discussing Energy Infrastructure Investment
Accelerating demand and the depletion of natural resources will result in significant medium-term investment in the discovery, development and delivery of both traditional and new sources of energy. A detailed paper from U.S. Trust examines the impact on, and consequences for, energy infrastructure investment. The authors identify a number of ways to take advantage of these dynamics, including investment in individual companies and in portfolios of companies exposed to energy and natural resources.

• Click here to read the article

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European Survey of ETFs
Exchange-traded funds continue to grow in popularity as an investment tool for both index management and the construction of benchmarks. Edhec Risk and Asset Management Research Centre presents the findings of its 2006 survey of ETFs and a discussion of the nature of the market for ETFs and their role in core/satellite investment. Overall, the survey points to a disconnect between strong awareness of ETFs among investors and asset managers as well as a common failure to exploit fully their potential as an asset allocation tool.

• Click here to read the article

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Shedding Light on Private Equity
A white paper by Greycourt provides a primer on private equity. It summarizes the market opportunity, identifies key risks and outlines a strategy for investing in private equity sensibly and profitably.

• Click here to read the article

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A paper by U.S. Trust examines the drivers of the private equity boom and considers what investors should expect this year. The authors predict continued strength in the sector, greater risk for investors and the possibility of a $50 billion deal in 2007.

• Click here to read the article

The Role of Asset-Liability Management in Private Banking
In terms of their approach to investment, wealthy individuals share certain characteristics with institutional investors. With this in mind, a paper drawn from EDHEC’s ALM and Asset Management research program and sponsored by Pictet & Cie, examines sources of value-added in private wealth management. Drawing on a number of practical illustrations, the authors argue that recent research in asset-liability management for institutional investors points the way for the design of a “truly client-driven” private banking service.

• Click here to read the article

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Lifestyle Management

Guide to Destination Clubs
A free guide to destination clubs, published by Helium Report, offers wide-ranging financial analysis, due diligence questions and recent developments in the industry. Also includes a number of destination club profiles.

• Click here to read the article

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Managing Risk and Liability Exposure

Risk and Structured Products
The Global Investment Returns Yearbook, produced by the London Business School in conjunction with ABN Amro, quantifies performance since 1900 of all major asset classes in 17 major markets in Europe, North America, Asia and Africa. A synopsis of the 2007 yearbook highlights the key findings. In particular, the authors find that structured products designed to protect investors against risk tend to harm performance disproportionately.

• Click here to read the article

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The Importance of D&O Liability Insurance
In an increasingly litigious society, characterized by ever stricter corporate governance standards, there is a growing need for liability insurance for company directors. A paper by HUB International examines the different types of directors and officers insurance policies available, drawing on a number of case studies. Also includes reference to the private and non-profit sectors.

• Click here to read the article

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Strategic Philanthropy

Focus on Self-Dealing in Family Foundations
In a recent teleconference, Andrew Schulz of the Council on Foundations discussed a range of family foundation issues related to self-dealing, or transactions between a foundation and a “disqualified person.” Topics included the definition of a disqualified person, travel expenses for family members and the sharing of resources between a family business and the family foundation. The teleconference is now available online, with accompanying slides.

• Click here to view the teleconference
  (File will play in Windows Media player / default video player)

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More information about self-dealing can be found in a guide, produced by the Forum of Regional Associations of Grantmakers and written by PriceWaterhouseCoopers.

• Click here to read the article

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Technology Trends

Thoughts on I.T. Challenges

Two contributions from the corporate world on managing I.T. challenges:

A white paper by IBM examines eight key challenges confronting information technology directors: managing the data explosion, finding intelligence in the data, enabling the new work styles, doing more with the same, keeping I.T. safe, acting rather than reacting, getting the details right and implementing service-oriented architecture.

• Click here to read the article

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What I.T. lessons can be learned from major companies? Research recently made available from InformationWeek highlights key issues on large corporate agendas, including streamlining business processes, improving customer relationships and controlling costs. Includes a number of vertical industry snapshots by sector

• Click here to read the article

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