Hong Kong and India have the highest percentage of
family-run billionaire fortunes, while China has one of the lowest,
according to a new survey which lays bare some surprising facts about the
world’s richest families.

According to ‘Global Wealth and Family Ties’, a survey
conducted by Forbes and commissioned
by Societe Generale Private Banking, three quarters of billionaire fortunes in
Hong Kong are family run, and 73 per cent in India – the highest proportion in
the world.

At one third, China has one of the lowest percentages of family-run billionaire companies, only
surpassed by the UK at a quarter, and Russia, at 19 per cent.

Hong Kong and Singapore firms have a strong sense of Confucian values, with high rates of family involvement, said the report. This can be partially attributed to the strong rate of real estate
fortunes in these two countries, which were made a couple of generations ago, right
after World War II. Real estate fortunes tend to be founded and managed by
family members.

A unique characteristic of these two countries is the
way they manage their wealth, said the report. “Families don’t trust one banker
with all their money and invest conservatively. In most Asian countries there
is a very strong sense of providing for family members. You trust members of
your family very highly, so they are the people you want to bring into the
business,” said Justin Doebele, chief editorial advisor at Forbes Indonesia.

India, like East Asia, has a high
percentage of family wealth. Indian business was all tied up in red tape until
1991, when economic liberalization unleashed the country’s entrepreneurial energy
and hundreds of first-generation businesses sprung up. In India, maintaining
strong family ties in all facets of life is a social expectation, as
is providing the best possible education for the children. These two strong
social undercurrents combine to create the foundation for qualified family
management for family fortunes, said the report.

Family members in India are often sent abroad for education
and some work experience before being inducted into the family business.

At the other end of the spectrum, China’s decades-long
communist regime and its influence on the mentality of people is clearly
reflected in the structure of the current fortunes, said the report. In China,
two thirds of businesses surveyed are non-family owned. In China there are a
lot of self-made billionaires who run their fortunes individually.

Overall, non-family-run fortunes performed better over a
three year period, showed the study, which used Forbes Rich List information on
billionaire families across 12 markets. Non-family-run fortunes gained 9 per cent in aggregate net
worth, while family fortunes grew 4 per cent within the last three years.

Seventy-seven per cent of fortunes are self-made in emerging
markets, versus 65 per cent in mature economies, a surprisingly small
difference, said the report.