Ida Liu & John Davis discuss how families now navigate the rapidly changing world

Ida Liu & John Davis


How should worldly and wealthy family enterprises navigate changing intergenerational dynamics, and protect their wealth? Citi Private Bank and Cambridge Family Enterprise Group’s latest white paper explores these critical themes and offers actionable advice on the way forward.

Behind many of the world’s most prominent families is a thriving family enterprise. Some have existed for many decades or longer while some are much newer creations. More than being just a source of family wealth, such enterprises are often an integral part of how families work together, express their values and contribute to society. Preserving and growing them for present and future generations is therefore of the highest importance.

While creating successful family enterprises is not easy, sustaining them over the long term is harder still. To do so, their owners need to embrace transformation strategies, particularly amid turbulent times such as those we are currently experiencing. They also need to prepare future family enterprise leaders via a carefully planned process.

Citi Private Bank and The Cambridge Family Enterprise Group have been working together for more than 20 years supporting enterprising families. We help them protect and evolve the management of their businesses and guide them in navigating changing family dynamics. Our two organizations also focus on helping global families manage succession across generations so that they do not fall into the trap of losing what they’ve achieved by the third generation and beyond.

This ongoing collaboration has resulted in the publication of our latest white paper titled - The future of family Enterprise: Turbulence and Transformation in the 2020s.

The study has delivered fascinating insight into how families now navigate the rapidly changing world. Following the publication of the paper, Ida Liu, Global Head of Private Banking at Citi and Professor John Davis, Founder of the Cambridge Family Enterprise Group discussed this critical subject.

Ida Liu: Given that you are the global experts in families and family succession please tell us what you’ve learned from our most recent collaboration?

John Davis: We embarked on a project together pre-pandemic to understand what can we do for families to help them plan for succession in their family businesses and what comes next? It’s very clear that the world has been morphing. We're in a decidedly new era with many new challenges facing families, family enterprises and society at large. We needed to figure out how our clients saw the world and its challenges so that we could better understand them to enable us to provide guidance on how they could better navigate this new world. The result is ‘The future of family enterprise' white paper which is a landmark in terms of guiding these families through this period and giving them some very clear actionable advice.

JD: The paper outlines five different strategies that families should really be considering. Each of these five strategies addresses a key vulnerability that we heard families and family enterprises are facing. If they adopt these new approaches for their businesses, family strategies and global outlook, we are very confident that the family enterprise can continue to outperform other forms of business in the future.

IL: I'm very excited about the whitepaper and the actionable strategies that families and family enterprises can take away from it. So, what are your key takeaways from the study?

JD: To begin with, we asked survey respondents 'What do you see out there and how would you rate the level of turbulence in the world?’ Over 80% of the respondents see the world as ‘highly turbulent’ and 85% say they’re going to need to make somewhere between moderate and radical adjustments to survive in this new age. Whilst it was comforting to hear they’re aware of the need for change less than a third of the respondents said that they were ready. Another third said they were ‘kind of ready’ for turbulence, but we believe that's not good enough in this day and age. In fact, it is very close to not being ready at all. It essentially indicates to us that we've got work to do to help these families chart a course, offer support, learnings from what other people that are doing well, and use practises to step up and play the game better and differently in current climate. I think one of the reasons that the fit between our two groups is so great is that Citi Private Bank has been really committed to the success of families. Tell us what is Citi doing to help and support its family clients?

IL: In addition to publishing our best practise research with you, our Global Family Office Group offers the most globally comprehensive family offering in the private banking industry. It encompasses everything from thinking about structuring and advice down to investments and philanthropy. Additionally, we are into all different areas under the advisory side to be a comprehensive partner and solutions provider to families around the world.

JD: I would add to that the efforts you're making in education, and helping to develop the talents, perspectives and capabilities of the next generation.

IL: Indeed, we launched a platform called Citi Latitude at the end of 2021 which is designed to further educate, engage with and get participation from not only our next generation of clients, but also our millennial clients. It's not just the global university programs that we do, which are wonderful, but we are also building an online learning portal. We have expert speakers come in each month to speak to the next generation and millennial clients on a variety of topics of importance; everything from leadership to financial markets, to geopolitical considerations, we cover it all. It's been extremely well received by both our clients’ successors and millennials as the variety of education is extremely broad.

JD: I really applaud all initiatives that encourage and enable the next generation to get excited about participating in their family enterprises. It doesn't have to be just in the business or management of the liquid assets; it can also be with philanthropy, community activity, helping the family stay together and stay committed to a mission. All of that is essential for family success. One of the great overlaps in our work is that we not only help provide these families with insights into what works in the world, but also help the partnership across generations to become stronger, utilizing the perspectives of both generations, as opposed to just the seniors. And I think that both of our organizations have our distinctive ways of helping that happen.

IL: And that's why we share this passion of making sure that we're providing so much support, guidance and advice to families. So, what is the one important mindset shift that you're seeing amongst families today? What do they need to adapt to?

JD: We think they really need to develop a new sense of what good stewardship means. It used to mean growing your existing business, developing it, and getting it into the next generation. That is for a variety of reasons, no longer a very reliable strategy. The notion of stewardship needs to evolve because that business may not be the right vehicle for growing value in the future. The most successful families are growing value in different ways. The best stewards have a more expansive understanding of their obligation to grow value in different ways. All of our five strategies are based on this new way of thinking about the family enterprise. We're excited about the insights gained from this study and how they can be used to help families grow.

IL: In addition to this amazing study we did together to unlock the five key trends for our families to consider, we are fully equipped to help them navigate these. At Citi, we have the most global institutional platform for families and their businesses around the world. We can do everything under the wealth management umbrella, and help their business and cash management needs as well.

JD: The combination of the things that you're doing are all so beneficial especially when built around the pivotal notion to focus on the interests of the whole family. Like Citi, The Cambridge Family Enterprise Group has built its practice around this founding principle that you need to serve the interests of all within that family group. One of the many reasons why our collaboration works so well is that we have the same focus.


Learn more about the five transformation

strategies for families and enterprises.