Building Cutting Edge Wealth Management Solutions

The world’s leading private banks are putting innovation and sustainability at the core of their offerings.

Amid ongoing geopolitical tensions and market volatility, Asia’s wealth management sector continues to leverage on the region’s growing ranks of ultra-rich. Despite the headwinds brought on by the Covid-19 pandemic in the past two years, the Asia-Pacific will see the biggest growth in the number of ultra-high net worth (UHNW) and high net worth individuals between 2021 and 2026, according to the 2022 edition of Knight Frank’s The Wealth Report.

Over the next five years, Knight Frank forecasts that the global UHNW population will grow by a further 28%, led by Asia and Australasia (+33%), followed by North America (+28%) and Latin America (+26%).

The new generation of wealthy individuals will have different demands compared to their parents when it comes to managing money. For instance, many will likely communicate with their wealth managers through digital platforms, which will facilitate remote transactions seamlessly at their own convenience. At the same time, environmental, social and governance (ESG) concerns will also be a key priority in the portfolios of the younger generation seeking to make the world a better place.

To this end, financial institutions such as HSBC and Citigroup are showing their ultra-rich clients unambiguous commitments to achieve their sustainability ambitions. Both banks are targeting to achieve net zero emissions by 2030 for their operations, while helping corporate clients across various industries to transition to a low carbon economy.

As part of a global group with corporate, investment and retail banking capabilities across an international network, HSBC’s Global Private Bank has a wealth of knowledge and expertise at its disposal to support its clients’ sustainability journey.

For Citi Private Bank (CPB) and its clients, committing to sustainable investments is a perpetual priority. In the coming years, CPB will bring their best thinking, research, analytics and fresh actionable investment ideas to help clients meet both their financial and sustainability objectives.

Besides sustainability, wealth and family governance planning has become more important due to the unprecedented intergenerational transfer of wealth expected to happen across Asia in the next few years. Institutions such as Liechtenstein-based LGT could help many of the region’s successful businesses prepare to pass on the reins to their second and third generation members amid an uncertain economic environment.

Founded over 100 years ago, LGT has established an enviable track record for helping clients with their family governance planning by putting in place governance frameworks built around common values, business goals and investment principles. The bank was founded by the Princely House of Liechtenstein, a 900-year-old business-owning family that has passed on their values and wealth across 26 generations.

As the wealth landscape evolves at a rapid pace, private banks that embrace innovation, sustainability and the evolving needs of their clients will continue to be at the leading edge of wealth management for decades to come.

Guiding Investors Towards A Sustainable Future

HSBC Global Private Banking helps clients drive positive change by achieving their sustainable investment goals.

Stefan Lecher, Regional Head of Investments & Wealth Solutions for Asia Pacific at HSBC Wealth & Personal Banking

As evidence of the climate emergency continues to mount, the adoption of sustainable investing solutions to tackle this global challenge is fast gaining traction among high net worth individuals around the world.

With the increasing focus on Environmental, Social and Governance (ESG) investments, global investors poured US$2.7 trillion of capital into sustainable investments in the fourth quarter of 2021, according to a report by Morningstar.

Meanwhile, a sustainable investing survey conducted by HSBC Asset Management shows that almost half of all high net worth investors in Hong Kong, China and Singapore believe that their portfolios will comprise solely of sustainable investments in the next three to five years.

“By supporting the right businesses, high net worth investors believe that they can have a positive impact on society, and also protect themselves against ESG risks,” says Stefan Lecher, Regional Head of Investments & Wealth Solutions for Asia Pacific at HSBC Wealth & Personal Banking. “So, it’s not just a case of doing good. Sustainable investing also helps them manage risks and be fit for the future.”

Lecher noted that the havoc wreaked by extreme weather events in recent years has brought the reality of climate change home for many investors, raising awareness on the need to incorporate ESG factors into their portfolios. At the same time, the Covid-19 pandemic has also prompted many to reflect on how they live and how they are impacting the environment. Following the COP26 climate summit last November, the COP15 biodiversity summit that is scheduled to take place in Kunming, China later this year should revive ambition from investors and policymakers to address the challenges of biodiversity losses and ecosystem degradation.

Role of Sustainable Finance

While innovation will be key to mitigating the climate and biodiversity challenges, fresh capital will also be required to fund new solutions. “The United Nations estimates a US$4.1 trillion financing gap in nature which must be closed by 2050 if we are to meet critical climate and biodiversity targets,” Lecher says. “That’s why sustainable finance is absolutely key to building a future that prioritizes resilience, social mobility and the environment alongside economic growth.”

Lecher believes that there are several ways in which the finance industry can contribute to the fight against global warming. Firstly, the financial sector itself can do more to ensure that its own operations are carbon neutral. Secondly, financial institutions can work with their partners to develop sustainable solutions.

“Banks can help to build solutions that allow capital to be deployed into a low-carbon economy,” he says. “That’s one side of the coin. The other involves providing investors with the networks, opportunities and education so that they can help support that effort. Investors will see this as an opportunity to deploy capital and give them access to new solutions and assets for their portfolios. They get the chance to not only help achieve net zero, but also generate positive returns.”

Scaling Up Climate Solutions

HSBC is unambiguous about its own sustainability ambitions. The bank aims for its operations and supply chain to be net zero by 2030. Furthermore, it is working towards the industries and companies it finances to achieve the same outcome by 2050.

To this end, the bank is using its expertise to help clients in their journey to net zero. One key aspect of this goal will involve scaling up technologies that will be critical in achieving the global goal of limiting global warming to 1.5 degrees Celsius above pre-industrial levels.

“To achieve this target there is a need to develop climate solutions by collaborating with partners and investors all over the world,” Lecher says. “However, many of these technologies have yet to be fully developed or are not yet commercially deployable as they have not been scaled up. This is HSBC’s sweet spot; bringing to bear our capabilities to help companies scale up their technologies, whether it’s sustainable infrastructure, clean fuel like hydrogen, or carbon removal solutions.”

HSBC also works with governments and regulators across the 60 markets where it operates to help achieve sustainable outcomes.

“We want to work with governments and other institutions on standards and regulations, and really make sure we build, finance and support sustainable projects as a group in many countries,” Lecher says.

Supporting Clients’ Journey

As part of a global group with corporate, investment and retail banking capabilities across an international network, HSBC Global Private Banking has a wealth of knowledge and expertise at its disposal to support its clients’ sustainability journey.

“As we are also a corporate bank, we work directly with our clients in their ESG transition as they move towards net zero,” Lecher says. “That gives us a lot of insight and research that we use and leverage—not just for our corporate relationships, but also for our private banking clients.”

ESG considerations are now a part of all private bank engagements to ensure that clients can achieve their financial goals while creating a positive impact. HSBC also works with its product providers to build sustainable solutions, whether it’s passive exchange traded funds, discretionary mandates, alternative solutions or structured products.

“We place a lot of effort in our communication with clients as part of our effort to integrate ESG into their investment frameworks,” Lecher says. “That makes HSBC really a go-to place if you want to protect and grow your wealth in a sustainable way.”


Investments in emerging markets may be extremely volatile and subject to sudden fluctuations of varying magnitude due to a wide range of direct and indirect influences. Such characteristics can lead to considerable losses being incurred by those exposed to such markets.

This article is not a personalised communication from HSBC to you and does not constitute and should not be construed as legal, tax or investment advice or a solicitation of the sale or recommendation of any product or service. You should not make any investment decisions based mainly or solely on this article. All investments involve risks and may experience upward or downward movements and may even become valueless.

Issued by The Hongkong and Shanghai Banking Corporation Limited

Investing With Purpose: Citi Private Bank Enables Investors To Make Sustainable Investments

With a strong commitment to sustainability, extensive expertise in investment advisory and a high level of personalized service, Citi Private Bank is well positioned to help clients achieve their financial and sustainability objectives in their investments.

Janet Shum, the Specialist for Sustainable Investing at Citi Private Bank in the Asia Pacific

“Invest in Our Planet.” That’s the theme for this year’s Earth Day, the annual event that has long made many reflect on their global environmental responsibilities. For investment professionals and high net worth clients, it is a timely reminder of the crucial roles investors can play in saving the world from the damaging effects of climate change. For Citi, it is their goal to deliver the best outcomes for clients while meeting their responsibilities to both the planet and its people.

With a 20-year track record in sustainability within the financial industry, Citi is at the forefront of setting the standards for sustainable investing, says Janet Shum, the Specialist for Sustainable Investing at Citi Private Bank (CPB) in the Asia Pacific. Citi is the co-creator of the Green Bond Principles and founding signatory of the Principles for Responsible Banking.

Citi integrates sustainability into its core strategy, long term priorities and business operations. For example, Citi has achieved its target to use 100% renewable electricity in its facilities globally in 2020. It also aims to achieve net zero carbon emissions for its own operations by 2030.

“We continually strive to carry out our mission in addressing some of society’s greatest challenges.” Shum says.

“An ever-increasing number of clients believe that private capital can and should be used to effect positive change. This principle is at the heart of Investing with Purpose, CPB’s approach to investing that aligns with clients’ personal values while pursuing competitive risk-adjusted returns. Sustainable investments are now seen as a perpetual priority and they are far from a once-a-year matter.”

Assessing the evolving sensibilities of investors, Shum says, “We are finding that clients are increasingly interested in sustainable investments as they seek holistic risk management solutions. At the same time, they can see the value accruing from diversification and exposure to sustainability-related innovation. Clients also benefit from knowing that their portfolios are properly aligned with their principles, and for some of them, being able to ensure a degree of synergy with their existing philanthropic commitments.”

Changing Sustainability Sensibilities

In essence, Shum believes many clients have progressed from just excluding environmentally-damaging investment options from their portfolios to embracing opportunities that have an intentional and measurable positive environmental and societal impact. There’s also an emerging understanding that many existing investments can be compromised by Environmental, Social and Governance (ESG)-related risks, as well as a clear aversion to ‘greenwashing’—the practice by some companies or individuals to falsely represent their activities as environmentally friendly. The focus on sustainable investments is not a wholly altruistic endeavor for clients, with many keen to capitalize on the high returns likely to accrue from key emerging sustainable sectors, such as renewable energy, electric vehicles and carbon trading markets.

The 360 solar panels installed on the rooftop of Citi Tower in Kowloon East, Hong Kong as part of the bank’s sustainable operations.

“It’s all about what we term Investing with Purpose, which is really an extension of our many years of experience in customizing portfolios for clients in line with their specific return and risk objectives,” Shum says.

In order to assist clients when it comes to evaluating the sustainability quotient of their portfolios, CPB’s Global Investment Lab has developed Lab Impact Framework and Tools (LIFT), a bespoke sustainability impact framework and tools. LIFT provides clients with quality, data-driven sustainability insights which complement the financial analyses to enable clients to make informed decisions. It also helps to quantify portfolio ESG risks, understand alignment to the United Nations Sustainable Development Goals (UNSDGs) and measure the carbon footprint of clients’ portfolios.

Accelerating Asia’s Sustainability Journey

Explaining why environmental responsibility has become one of the hot button issues within Asia, Shum says, “In simple terms, the evidence of developing countries—including many of those within the region—being hit disproportionately hard by human-caused pollution and climate change is clear. This was further worsened by the pandemic and has made addressing such issues a particular priority for the many entrepreneurs and investors keen to safeguard their businesses or investments, environment and the wider local communities.”

The United Nations Economic and Social Commission for Asia estimates the region needs to invest US$1.5 trillion annually from 2016 to 2030 to achieve the UNSDGs by 2030. “This urgent funding demand, along with increasing regulations on sustainable practices and disclosures as well as changing consumer behavior and technological advances have driven the rapid development of innovative sustainable business practices and investment solutions,” Shum says.

As a global bank, Citi recognizes that clients in Asia often face very different challenges compared to their counterparts in Europe or America. This is the case when it comes to sustainability, an issue close to the heart of many of the region’s wealthiest individuals.

Sustainable design was a priority throughout the renovation of Citi’s global headquarters in New York City.

“Many of our clients are business owners and leaders, who are in the midst of transforming and integrating sustainability into their businesses,” Shum says. “They now realize the value of sustainability to the resilience of their businesses in terms of both risk management and opportunities beyond regulatory compliance. Hence, they now want to apply that sustainability lens to their personal and family wealth management as well.”

Greening the World

After many years when various nations and institutions have evidenced wavering levels of commitment to environmentally-friendly practices, a perhaps worrying degree of consensus has now emerged. Climate change is taking place at the speed that is only set to accelerate. Given the widespread acceptance of the breakneck pace at which this existential threat is developing, it is all but universally understood that an urgent collective action is needed to preserve and protect the environment, with governments stepping up their pledge to net zero emissions during the COP26 Summit held in Glasgow, U.K. late last year.

In recognition of this urgency, CPB is committed to bring their best thinking, research, analytics and new actionable investment ideas to help clients meet both their financial and sustainability objectives over the next 12 months and beyond. CPB will also continue to foster a culture of discipline, transparency and risk management to ensure stringent oversight of sustainability governance and enhance investor confidence.

For investors, it is time to seek the kind of professional advice and experienced oversight that will allow them to both invest in the planet and secure the future for many generations to come. “We help define clients’ sustainability objectives and ensure these are incorporated into clients’ investment portfolios,” Shum says.

Family Governance Planning Unlocks Potential In Family Talent And Wealth

LGT Private Banking shares tools to harness family talent and transfer values, wealth and businesses smoothly and sustainably.

When it comes to succession planning, many families in Asia start with their core goals of managing risks to financial investments such as incapacity and demise. At the early stage, their wealth planning may focus on standalone wealth holding vehicles such as family trusts or family foundations.

Lim Ping Ping, APAC Head of Family Advisory & Wealth Planning for LGT

For family business owners, succession planning is much more complex, especially when multiple generations are involved in the business.

Lim Ping Ping, APAC Head of Family Advisory & Wealth Planning for LGT, an international private banking and asset management group that recently celebrated its 100th anniversary, explains, “In family businesses, there are two systems interacting with each other—family system and business system. To illustrate this, consider a patriarch who is both the head of family and CEO. As the head of the family, he may decide–and the children may also expect this–that the children should have senior roles in the company. While as the CEO, he may have a different assessment of what value his children can bring to the business. This simple example shows how challenging it is for families when considering succession issues for family businesses. The emotional and business needs may not always be aligned, and the person making the decision that can impact the business may not be so self-aware about which hat he is wearing when he makes that decision. This can create confusion and misunderstanding, and in time conflicts not just amongst family members but may also jeopardize the ability of family companies to retain external talent.”

Family businesses usually positively impact the larger community through job creation and, by extension, create the financial means for employees’ families to better themselves. Lim says she and her team of senior wealth planning specialists at LGT are focused on helping entrepreneurial families to understand how formal family policies and governance structures can help towards achieving longevity and sustainability not just of family businesses but also of family values, philanthropic approach and impactful giving.

Planning Dynamically Using Governance Structures

LGT approaches governance planning through four pillars: family, ownership, corporate and wealth governance. Lim explains that many Asian families start their governance planning by writing family constitutions. She says that in the workshops, LGT facilitates families looking to draft their family constitution. She and her team members also ask their clients what their family and business values are and how they communicate and make decisions pertaining to the family, company and assets.

“A set of shared values is the basis for governance planning. It is an expression of convictions that can then be translated into goals. You need to then turn to the ownership, corporate and wealth structures to identify how to have these convictions translated into actions. You need to go about it with the intent and strategy as with any planning.”

Lim observes that for some families, governance planning is so daunting that most families do not advance beyond having a family constitution drawn up. Lim says: “A set of shared values is the basis for governance planning. It is an expression of convictions that can then be translated into goals. You need to then turn to the ownership, corporate and wealth structures to identify how to have these convictions translated into actions. You need to go about it with the intent and strategy as with any planning.”

Lim, who is legally trained and admitted to practice as a lawyer in Singapore, New Zealand, England and Wales, and her senior team, use their legal, accounting, and trustee experience to help families ensure that values expressed in family constitutions are also put into action in ownership structures through the use of instruments such as shareholders agreements or in creating unity of purpose by co-investing together using fund structures.

Usually, the LGT team works with family stewards to identify achievable milestones, including assessing the suitability of a family office to help formalize the responsibility for governance planning.

Learning from Other Entrepreneurial Families

Lim says that one way to keep family members engaged is to share the learnings of other families. Most families are curious to learn from other families and are encouraged by the success of other family business owners on how they have used governance systems to create longevity and sustainability in family values and wealth, thus preserving and protecting family legacies.

One such family is the Princely House of Liechtenstein, the owner of the LGT Banking Group, who, as an entrepreneurial family and business owner, has transferred wealth for 26 generations for almost 900 years.

“Clients of LGT learn how mature family governance systems interact with each other by looking at how governance systems are used within LGT. A 900-year legacy means that the Princely Family of Liechtenstein has seen through wars, pandemics and other catastrophes. Clients often ask, in what way have governance systems helped the Princely Family navigate these chapters whilst still retaining their core values of being responsible business owners?”

To allow a friendly space for families to come together, LGT also provides services such as hosting family meetings, providing content during these meetings, setting goals and facilitating project management.

Lim believes that families will need inspiration and encouragement on this critical journey. “The Chinese have this saying: you are wealthy indeed if you are lost in the middle of the deep forest and can find someone to show you the way out. You are extremely poor if you are standing in the middle of a high street and can’t find anyone to point the way,” she says. “This proverb is extremely powerful because it tells you why a family seeks out answers from other families to learn the best practices. Because if you can find someone who can show you the way, I think you are already in a good place.”


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