(CNN) - Billionaires minted in the latest year accumulated more wealth through inheritance than entrepreneurship for the first time since UBS started tracking the fortunes of the world’s richest almost a decade ago, said CNN.
The network said billionaire heirs are more likely than their parents to focus on the major opportunities and challenges facing the global economy, investing in sectors such as clean energy and artificial intelligence, according to the Swiss lender in a report on Thursday.
“The great wealth transfer is gaining significant momentum as many billionaire entrepreneurs age,” said Benjamin Cavalli, who oversees strategic clients of the global wealth management unit of UBS.
“This is a theme we expect to see more of over the next 20 years, as more than 1,000 billionaires pass an estimated US$5.2 trillion to their children.”
CNN said UBS, which counts half the world’s billionaires as clients, found that US$150.8 billion was inherited by 53 heirs over the 12 months to April, exceeding the US$140.7 billion accumulated by 84 new self-made billionaires over that period.
Overall, the number of billionaires globally climbed 7% to 2,544. Their combined wealth rose 9% to US$12 trillion, before taking inflation into account.
That total remained below a peak of US$13.4 trillion reached in 2021, when the global billionaire community grew to 2,686 individuals, following a post-pandemic rally in assets such as stocks and property.
The report’s findings also reflected the subdued state of the initial public offering market through 2022 and early 2023, which limited the opportunities for entrepreneurs to list their businesses and increase their wealth.
For the first time, Europe led the growth in billionaire wealth, as a “post-pandemic shopping splurge” lifted the profits and share prices of leading luxury goods companies, based in France, benefiting the billionaire families behind them, the report said.
That includes LVMH chairman Bernard Arnault and his five children. Arnault is the world’s third-richest man, with a net worth of US$167 billion, according to the Bloomberg Billionaires Index. Arnault’s wealth eclipsed that of Tesla’s Elon Musk, who holds the number one spot, and Amazon’s Jeff Bezos (number two) late last year.
While technology and healthcare billionaires have accumulated the greatest wealth over the past decade, the report highlighted “early signs of improving fortunes” for industrials billionaires, which include the likes of India’s Gautam Adani behind the multinational conglomerate Adani Group, and Mukesh Ambani of Reliance Industries.
“This may continue amid government incentives in several countries to promote the energy transition and higher defence spending,” the report said.
By Surin Murugiah
December 1, 2023
