FOREWORD | OUR RESEARCH | 2020 AND COVID-19 | 1. TRANSPARENCY | 2. RELOCATION | 3. FAMILY & GENERATIONAL WEALTH | 4. THE ADVISER OF THE FUTURE | ABOUT BDO
COMPETING CONCERNS | NAVIGATING PUBLIC POLICY AND POLITICAL UNREST | LONGER TERMTRAJECTORY, SHORT TERM DISRUPTION | CONCLUSION
COMPETING CONCERNS RELOCATION
GRAPHIC 7:
LONGER-TERMTRAJECTORY, SHORT-TERM DISRUPTION
WILL ECONOMIC, POLITICAL AND SOCIAL INSTABILITY IN KEY JURISDICTIONS PROMPT A TREND TOWARDS HNWI RELOCATION (OF ASSETS AND / OR RESIDENCE) OVER THE NEXT 12 MONTHS? PLEASE CHOOSE ONE ANSWER.
THEVIEW FROM NORTH AMERICA JEFF KANE | National Managing Partner, BDO US
Alongside tax policy-driven decisions, it is clear that recent socio-political events have had the potential to throw relocation priorities into the air, particularly given the premium placed on safety and stability by private clients. As one investment manager points out, “2008 was about money and financial security” whereas the COVID-19 pandemic “has been more profound, prompting questions like ‘are my family and I safe?’”. As some semblance of normality returns, the impact of health and social justice crises is becoming clearer. While the ubiquitous nature of the coronavirus means that relocation destinations have not yet been too drastically influenced – “no country is immune to it,” says a European lawyer – the different approaches of leadership figures in both navigating the pandemic and subsequently bolstering the treasury may provide wealth owners food for thought. In many ways, the core decision remains the same: what do you want and need from your physical base, versus those other things you are happy to travel
Theworldwas a very different placewhenwe started this study. However, the situationwe have been thrust into on a global level has sharpened the thoughts of many of respondents and perhaps even accelerated their plans. While at this time there are still many restrictions on travel between countries, that does not necessarily impact the potential for future opportunity and growth. Despite the unfortunate number of COVID-19 cases in the U.S., the country has historically been very resilient in the long term from a business perspective and we expect it to be able to remain on this trajectory. There is certainly potential for taxes to increase in order to pay for some of the stimulus enacted and the changing political landscape will have its impact. However, our clients have continued to preserve and are, against a backdrop of change and uncertainty, very engaged in planning the future of their family wealth enterprise.
46%
32%
17%
for? Do you fly in and out – rather than relocate – for healthcare, golf courses and beaches, for example? Social unrest is a more divisive issue and this varies significantly from country-to-country.
Our data shows that on top of political stability being the dominant relocation driver, only 4.8% of respondents said that economic, political and social instability is ‘not at all’ prompting a trend towards relocation (Graphic 7).
5%
very much so
moderately
not particularly / no different to previously
not at all
WORLD OF PRIVATE CLIENTS | NOVEMBER 2020 14
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