Wealthy people across Africa set their hearts on giving more to skills, training and education

Wealthy people across Africa set their hearts on giving more to skills, training and education

Job creation, training and education rank as the leading causes wealthy Africans are striving to support, according to the 2018 Wealth Report published by Knight Frank, Standard Bank Wealth and Investment’s global property consulting partner.

While the report highlights the rise in the importance of Africa as a wealth investment location, it also shows that many wealthier families and investors are very concerned about the world in which they live – and want to make a difference.

“While health and the environment are also high on the agenda of philanthropic causes for Africans, the need for jobs is one of the most pressing and this is clearly reflected in the desire of wealthy Africans to give more towards training and job creation. This can only bode well for the future of the continent, which is desperate to expand and create more opportunities,” says Philip Faure, Head of Cape Regions and Philanthropy at Standard Bank Wealth and Investment.

According to the report, 58% of respondents to the survey selected education as the philanthropic cause their high -net worth African clients were most likely to support, versus a global average of 54%. Thirty percent also selected training and job creation, with the global average at a mere 14%.

“Seeking societal outcomes to investment - like job creation and training – is a growing theme to watch as more wealth is directed towards making a difference. More money is going towards pressing issues like disaster relief,” says Mr Faure.

While philanthropy is still a relatively immature market in Africa, the recent report shows that 70% of respondents expect philanthropic activities to increase in Africa from a 68% global average.
Notably, 76% of wealth advisers in Africa says their clients’ wealth increased in 2017 and will do so again in 2018.  South Africa alone is forecast to see a 20% uplift in its ultra-wealthy population over the next five years following a 14% rise in 2017.

“However, it is also clear that effective planning weighs heavily on the minds of wealthy individuals and only 47% of high-net worth individuals in Africa have a robust succession plan in place, which is the lowest of all regions except Russia,” says MR Faure.

At the same time complexity is on the rise, making wealth management a far broader concept today than it ever was.

“At the end of the day there is enough money in society to solve all our problems and this is why philanthropy has such a crucial role to play and is such an important factor in the minds of wealthy clients. The role of a trusted bank like Standard Bank, as the mechanism to join the two together is also becoming ever more critical,” says Mr Faure.

Philanthropy needs to play a big role where general resources fall short across Africa.
“Government’s resources are limited and so the role of philanthropy in Africa will keep rising in the future as more of Africa’s wealthy think beyond their own lifetimes to make a difference to their communities and societies after they are gone. Seeing a social return on investments is becoming increasingly sought after and this trend correlates with increases in wealth,” says Mr Faure.

Importantly, though, the art of giving must form part of an overall, long-term wealth management plan, which includes building wealth, preserving wealth, and maintaining lifestyle and legacy wealth.

Standard Bank – Africa’s largest bank by assets, with a footprint in over 20 countries, including Wealth and Investment presence in Kenya, Nigeria, Ghana and Mauritius, and internationally in London and Jersey – continues to provide advice that matters to families seeking to broaden their philanthropic activities while maintaining their overall wealth objectives.

“Trusted experts with a deep understanding of Africa need to assist investors and families by setting up the most appropriate structures to maximise outcomes and optimally formalise the giving process,” concludes Faure.

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