HKUST Business School Magazine

References 1. Dominique Nguy, “Tung family sells shipping firm for $34b,” The Standard, 10 July 2017, https://www. thestandard.com.hk/section-news/section/11/184902/ Tung-family-sells-shipping-firm-for-$34b, accessed 19 July 2023 2. Tong See Kit, “More ultra-wealthy families setting up offices in Singapore, and they’re not just coming from Asia,” Channel News Asia, 12 January 2023, https:// www.channelnewsasia.com/singapore/family-offices- ultra-rich-set-singapore-financial-sector-3182131, accessed 19 July 2023 3. SCMP Editorial, “Hong Kong ideally placed to be family office hub,” South China Morning Post, 23 November 2022, https://www.scmp.com/comment/ opinion/article/3200628/hong-kong-ideally-placed-be- family-office-hub, accessed 19 July 2023 4. Mia Castagnone and Iris Ouyang, “Asia-Pacific family offices continue ‘strategic shift’, to increase equities and developed-marketfixed-income asset allocations: UBS,” South China Morning Post, 1 June 2023, https://www. scmp.com/business/banking-finance/article/3222591/ asia-pacific-family-offices-continue-strategic-shift- increase-equities-and-developed-market-fixed, accessed 19 July 2023 5. UBS Switzerland AG, Global Family Office Report 2023 (Zurich, Switzerland), https://www.ubs.com/ content/dam/assets/wm/static/noindex/gfo/docs/ubs- gfo-report-2023.pdf, accessed 19 July 2023 6. Vivien Teu, Partner, Hong, Kong, Dentons, “Hong Kong tax concessions to welcome family offices set- up,” 23 May 2023, https://hongkong.dentons.com/ en/insights/articles/2023/may/23/hong-kong-tax- concessions-to-welcome-family-offices-set-up, accessed 19 July 2023 7. “Family Office,” Wealth Management Institute, Singapore, https://wmi.edu.sg/programmes/family- office/, accessed 19 July 2023 8. https://afbfo.hkust.edu.hk/frontpage , accessed 19 July 2023 Mitigate potential conflict The family office can also be a platform for family governance, whether or not the founder’s business remains intact. The Chinese have a saying about the “curse” of three generations of family wealth, based on long experience with a patrimonial system that engenders conflict as the family grows larger. Each set of siblings has their own emotional dynamic, but ideally the family office can mitigate any potential for conflict by helping to assign roles, including running the existing business. Philanthropy is another avenue to extend legacy and family harmony and unity, if not wealth preservation. However, stating the obvious, there will be no philanthropy if there is no wealth. In Hong Kong as well as other parts of the Sinosphere, including mainland China, millennials are excited by impact investing, a form of philanthropy in which the philanthropist can remain deeply involved in project operation and the output is social capital. Millennials are also much more likely to be convinced that ESG investment – in the environment, society and governance – supports yields in a macro-economic sense even if in general they represent enterprise costs. But if philanthropy brings the family together around good causes, it has the secondary effect of keeping the family together when economic forces might tend to bring about conflict. Foresight, commitment, and purpose There can be no doubt that family offices in Asia are shaped by the businesses created by the founders as well as their values. How well these values are reflected in the organization and goals of the family office will depend on foresight, commitment, and a sense of purpose, not just the fundamental purpose of the office as a wealth management vehicle. In Singapore, the Wealth Management Institute offers courses for family office professionals, including certificates in legacy and impact for the family, succession and wealth transfer, and principles of investing for the family. Hong Kong is planning something similar. 7 Our ongoing effort at HKUST is complementary to these developments. At the Roger King Center for Asian Family Business and Family Office, 8 we provide the intellectual foundation to bridge the knowledge gap between academics, practitioners and policy makers, through workshops and seminars on a wide range of topics, as well as our Asia family business case studies. As the landscape for family businesses changes in the China-influenced parts of Asia-Pacific, so will the needs and purposes of family offices in the region. We hope that our work will support the development of both in this enormously vibrant and productive region, which over the past decades has increasingly become a hub and driver of the global economy. Biz@HKUST 11