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Mishcon Women in Wealth presents: the role and growth of family offices in Asia

Posted on 12 December 2021

In this episode of Mishcon de Reya Women in Wealth Presents, we discuss the role and growth of family offices in Asia with Sylvia Lim, CEO of Rheingold Family Office. Rheingold is a family office headquartered and licenced in Singapore with presences in Hong Kong and Shenzhen, serving ultra-high net worth individuals and their families. Sylvia also shares her insights on the evolution and growth of women's wealth throughout her career in the financial services industry, having served many high net worth and ultra-high net worth families in Asia and the rest of the world.

Stephanie Pierce, Managing Associate
Mishcon de Reya

Hello and welcome to Mishcon Women in Wealth Presents, a series of interviews and discussions where we talk about and unpick some of the topics and issues relevant to women in wealth.  My name is Stephanie Pierce and I am a Managing Associate in the Tax and Wealth Planning Team at Mishcon de Reya based in our Singapore office.  Today I am delighted to be joined by Sylvia Lim.  Sylvia is the CEO of Rheingold Family Office, which is headquartered here in Singapore and has presences in Hong Kong and Shenzhen, China.  Rheingold is a family office which serves high net worth and ultra-high net worth individuals and families and provides bespoke solutions to grow and protect the wealth of its clients.  Sylvia has over 28 years of experience in the financial services sector and has acted for many high net worth and ultra-high net worth families throughout her career with several private international banks before founding Rheingold.  Sylvia, thank so much for joining us today. 

Sylvia Lim, CEO
Rheingold Family Office

Thank you for having me.  It’s a pleasure. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

So, let’s start with why we’re having this conversation.  Why do you think it’s important to specifically consider the needs of female wealth holders and wealth creators?

Sylvia Lim, CEO
Rheingold Family Office

Simply because women have become a major economic force to reckon with.  To just give you some context, in a BCG report last year, it stated that now women control one third of the world’s wealth and this wealth is estimated to grow by some 5 trillion each year so, based on that, that report itself, you can see, you know, it’s not a small sum but obviously it is also very important to… and in the same report it stated that women are very underserved for whatever reasons it could be that a lot of financial providers are making lots of assumption about what women want, what kind of messaging they need and thereby you know, at best, they’re giving very superficial solutions.  So, as women ourselves, I think it is important for us to have conversations like today, whereby we can exchange ideas between industries, yours and mine, and also more importantly to reach out to our female clientele so that they can be very informed and they can know how, you know we can support them better. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

Absolutely and of course we are in Asia and we’re speaking predominantly about Asian clients and their businesses.  So, anecdotally have you seen a growth of female wealth in Asia over the course of your career?

Sylvia Lim, CEO
Rheingold Family Office

Yes, absolutely.  From the late 1990’s where I started my wealth management career until now, I have seen a marked increase in women wealth, not just in wealth creation but also in them managing businesses.  Traditionally women come into wealth from inheritance from their families or from their spouse but in this part of the world in Asia it’s not uncommon that women are entrepreneurs themselves and that they are, they are in woman leadership positions so they do create their wealth as well.  But I think most importantly it’s not that women are creating wealth or holding wealth, I think most importantly it’s that they are managing their wealth more independently these days. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

And so, do you see a difference in the style of management between wealth inheritors and wealth creators?

Sylvia Lim, CEO
Rheingold Family Office

Personally I don’t think there is a certain kind of trend, a marked differences the two, I might be wrong but I think a lot of times when it comes to managing wealth, it’s very contingent on one’s characteristics, one’s objective, their background, their DNA in general, not so much about whether they got their wealth or they created their wealth, I think that’s secondary.

Stephanie Pierce, Managing Associate
Mishcon de Reya

And so you have a great deal of experience in this sector and no doubt you’ve come across numerous different types of clients.  Have you seen a difference in the way that women manage their wealth compared to men?

Sylvia Lim, CEO
Rheingold Family Office

I get that question quite a lot and I’ve done some thinking, do I really see a difference in terms of how women and men manage their wealth and I hate to disappoint you if you think that there is because, honestly I don’t, again it is based on really the person’s background, their characteristics as I mentioned, you know, their preferences, rather than gender.  I have seen, you know, my women clients who are great risk takers and my male clients who are not risk takers and vice versa so, I can’t really point a finger to have an assumption and I don’t want to have any assumptions because as pointed out earlier in the BCG report, a lot of the reasons why women are underserved is because they are a lot, that could be because of all these stereotype beliefs about what women want and assumptions about how women behave and so forth.  So, I think it’s critical for us as practitioners to just look at every individual as a unique individual and then cater rather than form assumptions about them before we offer the solutions.

Stephanie Pierce, Managing Associate
Mishcon de Reya

Yes, because you mentioned risk, I think that’s one of the big stereotypes that female investors are more risk averse.  Have you come across that, I assume?

Sylvia Lim, CEO
Rheingold Family Office

So, yes, so I don’t see the marked trends so I can debunk the risk just based on, just based on the sample size I have.

Stephanie Pierce, Managing Associate
Mishcon de Reya

Yeah and what about, I mean there have apparently been studies that demonstrate that women are apparently more interested in ESG investments than men.  Do you think that holds out?

Sylvia Lim, CEO
Rheingold Family Office

Sure, I think that there are studies about that, about women being more interested in ESG related kind of schemes and investments and so second generation as well, they are also another segment that have been cited, often cited as being more interested and being more involved.  I can understand the relation but I tend to believe that Covid or this pandemic would be an inflection point.  Why I say that is because Covid has actually really created a lot of awareness around ESG and sustainable investment themes and I suspect that a lot of clients are getting involved, gender aside, a lot of clients are seeing the significance of having their portfolios being allocated to these kind of investments, these kind of asset classes and it’s because clients now understand that besides making a profit, they can also invest and do good at the same time. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

And have you seen a generational shift between the attitudes and approaches of and toward female holders of wealth, say twenty years ago compared to today?

Sylvia Lim, CEO
Rheingold Family Office

There are two key trends I have observed.  First, it would be women are coming or managing their wealth, the family business, their personal wealth or their family wealth, at a much younger age and that could be in tandem with the shift in the world as well, we are seeing a lot more youth leadership in organisations.  The other aspect I have observed is the general increase in trust and confidence in female leadership in families.  I have seen that traditionally at least in Asia, a lot of families tend to maybe prefer the male gender compared to the female gender when it comes to taking leadership positions or leadership responsibilities in the family but increasingly, we see that there are a lot of other factors or considerations such as competency and also willingness, attitude of an individual and willingness to step up to help the family or to manage the wealth.  So these are given due considerations and therefore women are also having a larger role to play in the family businesses as well as managing the family’s wealth. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

So, then do you think then that female millennials or even Gen Z are benefiting from this shift more than maybe their mothers would have this perception?

Sylvia Lim, CEO
Rheingold Family Office

This is for sure, yes, this is for sure they are given more opportunities, there are less assumptions about them so they have a better head start in that respect.  The rest is of course up to their competencies and their own individual capabilities and commitment and adaptability to manage. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

So turning now to family offices because Rheingold is a family office.  When we refer to a family office, what does that mean?

Sylvia Lim, CEO
Rheingold Family Office

Well that’s a very huge question.  I’ll try to summarise but, yes, the concept of family offices is more well established in centres like Europe and North America and less so in Asia but it’s increasing at a very, very fast pace no less.  I’ll just give you some context according to a camden research, there are now about 7,300 family offices in the world managing US 5.9 trillion of assets.  The largest centres, the largest percentages are still residing in Europe and in North America.  In Asia we are seeing double digit growth, very, very, at highest growth rate.  So, the concept of family can take many forms.  At its most basic form, it could be just simply an admin office of professionals to help take care of investments and some administrative duties of the family.  So, typically, a family, a business family usually may start with having a team of investment professionals to help look after their business concerns as well as their family wealth.  That’s how most families will start.  But as a family evolve and grow, the needs become more complex and they might see that they need to look at more strategic planning that serve the family wealth and that’s where the concept of the family office comes in because it’s seen through the lens of a wealth manager and you know, they can look at strategic planning in terms of succession planning, legacy planning, tax planning perhaps, that is more serving the needs or serving the objectives of the entire family. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

So, in the same way that a family might have obviously its own business structure for the family business, actually the family office is a separate entity or separate structure for their personal wealth, for their personal planning really. 

Sylvia Lim, CEO
Rheingold Family Office

Absolutely and increasingly these days, you will see a lot of families are taking a special interest for example in family governance, in family constitutions.  So these are what the professional teams internally managing their business may not be able to have the expertise to help them in such areas. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

And do you find actually that the interest in family offices is kind of coming to a peak in Asia with the first to second gen or is it a more second to third gen or, in your experience, what kind of generation of wealth is, seems to be the progenitors of the family office here?

Sylvia Lim, CEO
Rheingold Family Office

Okay, depending on which part of Asia because there is still some differentiation say in China, the majority are still in the first/second generation of wealth and in southeast Asia, I would think it could be fourth generation or even the fifth generation, six for some even a sixth generation.  So there is, there are differences even in Asia itself. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

Sure.  And so when we talk about family offices as well, some of our viewers in Singapore may have heard, single family office or SFO or multi-family office or MFO.  What is the difference between those and which one is Rheingold?

Sylvia Lim, CEO
Rheingold Family Office

Okay, that’s a good question.  So a single or family office are what you may have read from the media, the flux of a lot of family… a very established family coming into Singapore to set up their single family offices.  To cite some examples, you might have read about Sergey Brin or Google or Ray Dalio or Bridgewater and most recently, the Oppenheim family of the DBS Group, they are all coming from the West but then they are setting up their single family office in Singapore.  So, those fam… the single fam… as a rule of thumb, the single family office takes place when they want to manage assets under management and typically the asset under management must, should be around 50 million, US 50 million minimally, to about 100 million at least to make it economically viable, right, because it requires a lot of heavy commitment in terms of cost and time.  Of course, a single family office does have the full advantage of full autonomy and full privacy and that’s what’s being valued most of the time in single family office.  There are some clients or some families regardless of the assets under management that they have or they hold, they may still prefer to tap into multi-family offices like ours, like Rheingold.  So, Rheingold is a multi-family office whereby we are licensed at multi-family office in Singapore, licensed by the Monetary Authority of Singapore and we take care of multiple families, as the name suggests.  So, the advantage is we are still an independent advisor and we can provide a full array of services that a family office is but to the client, it just means it is less onerous in terms of admin, in terms of investment, they can possibly enjoy economies of scale and for some instances, the client value the fact that they could also have the opportunity to exchange ideas amongst the families or between some of the families or in some instances they could co-invest into certain investments together, where if their interests and objectives are aligned.  So there are a lot of all these kind of side benefits that is happening in the multi-family office space. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

Do you find families collaborating like that?  Does that happen quite a lot in practice?

Sylvia Lim, CEO
Rheingold Family Office

It does from time to time but I must emphasise that as a multi-family office we don’t start it from that… we don’t start from that premiss.  Each individual client that comes to us, we don’t co-mingle their assets, we don’t co-mingle our conversations, you know, we are beholden to each client as if we serve the client like a single family office and that’s very important in the wealth management arena, of course privacy is key. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

And how can a family office help female clients?

Sylvia Lim, CEO
Rheingold Family Office

Ah.  I think we can really do a lot to help female clients, just from the context that female, they have to fulfil multiple roles.  I am a female myself and maybe you appreciate that with that thought with me as well that we usually have to perform multiple roles so, it helps that to know that, you know there is this level of service that they can access of family office whereby to help them to look through their lens, to manage all their investments out there and also to curate bespoke services that is relevant to the female client.  So, it of course the kind of services would range dependent on what the client needs, say for instance, a younger, female client who is second gen coming into business, they may need mentorship, they may need tools and ideas or education around financial planning or portfolio management, these are all things that a family office can provide in addition to the private bankers because the family office can come in and give them an independent view of what their bankers first provide, so that’s one thing.  The other thing is for the more elderly female client, what I can think of is they might be, perhaps they might be looking at items like succession planning or they want to give in a more impactful or meaningful way and they want to do certain charitable foundations or they want to give towards certain kind of causes so they need to partner with somebody to help them coordinate, that could also be a possibility or simply it could be just a female client who has got multiple things around and they need to organise and reconsolidate and make it viable for themselves in their later years.  That is… those are items that a family office can come and help them. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

I suppose then it’s a way, as you say, to consolidate advice and approach in what can otherwise be quite a noisy space, you know, you can have lawyers, accountants, bankers, you know, all sorts of different advisers kind of telling you different things and maybe the role of the family office is to be that consolidatory point that can, you know, do the liaising for you I suppose. 

Sylvia Lim, CEO
Rheingold Family Office

Yes, yes, absolutely.  So, you can see, you can say that the family office can be like a concierge service of sort to help interphase with the lawyers, the accountants, you know and whatever, tax planners, the bankers, so we are one-stop shop and we look to provide a service from the end goal what the client needs. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

And so if a woman wants to set up a family office or she wants to approach a multi-family office, what should she do?  What should she have in mind? 

Sylvia Lim, CEO
Rheingold Family Office

Ah.  That’s a very big question but I think these, the answer to this is not just pertaining to the female clientele but to all clients in general looking to set up family office.  Of course the first thing first, they have to consider what’s the family office use… going to be used for?  What’s the objectives that they want because the… setting up the family office requires very heavy commitment, as I mentioned earlier so, it is important that they mapped out and they know really what they want to achieve.  Then, the next most important thing, I feel, that is happening right now would be landing the assets in the right jurisdiction and by that I’m saying, you know, I’m pointing out to the fact that the worries of the financial world is really a very different place from when I started my career, you know, offshore tax havens for example is almost not in existence anymore and in the last ten years or within the last ten years, we have seen global governance from the likes of FATCA, common reporting standards, automatic exchange of information.  All these are… has come into play and more so will be coming into play, I think more so especially with the technologies allowing that as well and there’ll be more multilateral agreement, so it’s very important for the end customer, the end individual, to reassess all their structures to make that… it still continues to make sense.  Lending into a right jurisdiction is very key because they want… most of my customers, they want to make sure that they don’t invite unnecessary scrutiny, they want to, you know, have their wealth provide them with the kind of happiness that they deserve, the kind of peace, which is what wealth ultimately should do, not give the client any burden but give them the freedom as well as the happiness that they or their family deserve.  So, other than looking at the jurisdiction and it doesn’t have to be the jurisdiction that is near to the client’s home ground, if you know what I mean, just like the examples I have mentioned earlier, all those names, we have seen that they just moved across the globe rather than to just choose something that is next door to where they live so that’s also, that’s also the consideration.  The other thing obviously would be to look at whether that jurisdiction offers access to opportunities, if that’s what the client is after, the economic and political stability, the rule of law, the tax regimes, access to professional teams and infrastructure is always very important, the cost as well, for some family office the incentives and the schemes.  So, when Rheingold, as a multi-family office, when we first studied all these factors and we wanted to set up our family office, we considered various jurisdiction and we really feel that, you know, Singapore tick a lot of the check boxes if not all the check boxes and that’s why we have put our multi-family office here in Singapore and for clients out there who are interested in Asia and who would like to set up a family office in Asia, you know, they can come to speak to someone like us, like a multi-family office or any other multi-family office that’s in Singapore. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

So, Singapore, is it right to say that Singapore is kind of the leading jurisdiction for family offices in Asia at the moment?

Sylvia Lim, CEO
Rheingold Family Office

I would say that, as you would probably know the two main financial centres in Asia are in Singapore and also Hong Kong and Hong Kong is also promoting the fund management business as much as Singapore is.  So each of the jurisdictions has its advantages and its competencies and it’s very different, some are very similar so again to the client, we will match, we will talk to clients and see which jurisdiction that suit them.   

Stephanie Pierce, Managing Associate
Mishcon de Reya

Okay, great.  Well, thank you so much Sylvia, I’ve learned a lot about family offices today.  It was a real pleasure talking to you. 

Sylvia Lim, CEO
Rheingold Family Office

It’s my pleasure. 

Stephanie Pierce, Managing Associate
Mishcon de Reya

So, thank you for joining us in this session of Women in Wealth Presents and we’ll see you next time. 

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