Legacies at risk as almost half of UAE-based entrepreneurs lack succession plan

(MENAFN- HSBC) Almost half of entrepreneurs based in the UAE have no succession plan in place to secure their business and family wealth for future generations, according to HSBC’s Global Entrepreneurial Wealth Report.

The report, which surveyed 1,882 entrepreneurs globally - including 155 from the UAE-reveals that 98% of UAE entrepreneurs are optimistic about their business outlook, yet 48% have not established a succession plan for their wealth or businesses.

Aladdin Hangari, Head of Global Private Banking, HSBC Middle East, commented:
“UAE entrepreneurs are at the forefront of the innovation and growth that is helping to drive the economic transformation. However, the lack of succession planning for so many could hinder the legacy they are working so hard to build for themselves and the next generation. Robust and well-considered wealth and succession plans take time, especially when, for so many here in the UAE, an international element needs to be accommodated.”

The report finds that UAE entrepreneurs are among the world’s most optimistic, with 95% expecting positive growth in their personal wealth in the near future. This group cites long term, geopolitical factors as a net positive for their personal wealth prospects.

The UAE continues to attract global entrepreneurs, particularly from India and the UK, who are drawn by its dynamic business environment.

Despite this optimism, the research shows that long-term planning often takes a back seat. While 39% of UAE entrepreneurs with a succession plan intend to pass their business to the next generation, a significant number have yet to start the conversation about wealth transfer within their families. In fact, 22% say they will only transfer wealth after their passing, a figure notably higher than the global average.

Gemma Wild, Head of Global Collaboration, HSBC Global Private Banking, MENA said:
“Our research and experience in this area shows that being prepared for business succession and communicating wealth transitions with family early are central to long-term survival and success.

The UAE’s entrepreneurs are also distinguished by their strong sense of purpose: 88% align their business with personal values over profit, and 96% of ultra-high net worth entrepreneurs take action to have a positive impact on society. However, the report underscores the need for these visionary leaders to match their ambition with structured planning for the future.

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