The Problem of Wealth Inheritance in Chinese Family Enterprises: The Interest of the Second Generation of the Rich in the Real Economy Has Weakened

How to pass on the wealth of family enterprises is becoming a difficult problem facing Chinese entrepreneurs.

At the 4th China Family Heritage Forum 2015, co-hosted by CEIBS and Phoenix Finance on July 11, Zhang Weijiong, Vice President and Provost of China CEIBS, Li Xiujuan, Co-Director of CEIBS Family Heritage Research Center, Rui Meng, Professor of Finance and Accounting and Co-Director of CEIBS Family Heritage Research Center, and more than 200 domestic family business founders brainstormed on the topic of "Inheritance and Innovation, the Source of Family Wealth Power".

The Daily Economic News noted that at present, the generally young Chinese family enterprises are facing the transformation challenge of the "new normal" of the economy: GDP growth is slowing down, the structure is deeply adjusted, the stimulus policy is gradually digested, and many difficulties are superimposed.

Zhang Weijiong believes that young people are now facing a colorful world full of temptations and changes, believing that opportunities are too abundant, and the fast money outside is too easy to earn; and the so-called concept operation, capital operation, mergers and acquisitions, investment leverage, virtual economy, etc., make many people confused and disoriented. This makes the "second generation" who inherit the mission of interest in the real economy and the manufacturing industry is decreasing. "Entrepreneurs are facing serious problems and very big challenges: how to pass on the foundation, wealth, brand, ideals and expertise that the previous generation of entrepreneurs have worked so hard to build to the next generation." Zhang Weijiong pointed out.

In view of the core issue of family business inheritance - how to pass on wealth, the forum invited internationally renowned enterprises to share their family wealth inheritance experience, and discuss family funds, philanthropy and family wealth inheritance models.

Sir Rong Hailan, chairman of the American Dragon Group and secretary general of the Dragon Fund, believes that family inheritance is mainly reflected in two aspects of inheritance: one is the family's wealth inheritance, and the other is the family's honorary inheritance.

First of all, for wealth inheritance, now a more reasonable and scientific approach is to set up a family fund, the family fund to achieve the unified management of equity, it will effectively ensure the sustainable development of the family business; compared to wealth is more important than the reputation inheritance, quality education and effective communication is an effective way to help the heirs better inherit the family concept and continue the family reputation.

Elliott Donnelley, the fifth-generation heir of the American printing king Donnelly family, gave a keynote speech on "The Practice and Experience of International Family Offices". He believes that the values of the family business are very important. Family members need to have foresight rather than focusing only on immediate interests.

At the forum, a copy of the "White Paper on Wealth Management in China- China's Private Family Wealth Management" jointly prepared by China Europe Business School and Shanghai Trust was officially released, and the reporter noted that the white paper conducted a multi-angle and all-round analysis of China's private family wealth management, and came to the following conclusions: The asset allocation of Chinese private entrepreneurs is not diversified enough, and the holding cost is not considered; investment habits rely on personal experience, and investment return expectations are not rational; financial personally, relying on personal judgment and their own network of contacts. The trust in professional institutions is not high; the awareness of philanthropy needs to be expanded, and private entrepreneurs should pay attention to the education of their children's families.

In addition, in the roundtable forum session, in view of "how to learn from the mature experience of developed countries in Europe and the United States, how to formulate a personalized wealth inheritance plan in combination with China's national conditions, and how to make better use of the wisdom services of family offices, scholars, professional elites and family leaders examined the wealth inheritance of family enterprises from multiple perspectives and jointly explored the way for The foundation of Chinese-style families to be evergreen."