A contributor to this publication's recent report, "Winning Women In Asia-Pacific" discusses the findings, the data and the lessons to take away from this study.

The following article comes from Caroline Burkart, who is associate partner, Client Insight, at Aon. 

WealthBriefing’s new research report, “Winning Women in Asia-Pacific” highlights the tricky balancing act of addressing female clients’ specific needs while also acknowledging the huge diversity of this “segment”. (See original article here.)

When contributing to WealthBriefing’s latest report on improving provision for female clients in Asia-Pacific, I was able to bring some very apposite insights to bear from our past research. 

This compared both men with women in the region, and women in APAC with those globally. Our findings highlighted often very great differences in both cases, showing how neither treating women “just the same” nor simply transposing female client strategies from other markets are sufficient responses. They also highlighted frequent stark differences in attitudes, wants and needs intra-group, underscoring how rigorous segmentation will have to be in order to address the full spectrum of wealthy women in APAC successfully. 

First is an engagement issue we identified in our 2017 Asia Pacific Wealth Transfer Report with RBC Wealth Management, which is likely to be similar today. We found that although women do take the lead on day-to-day banking, they are around a third less likely to be the sole decision-maker when it comes to investment portfolios. And, although approaching a fifth of the women we surveyed rated their wealth and money knowledge at the highest level, that naturally leaves a large proportion who could benefit from thought-leadership in key areas.

Intention vs action
One of these is undoubtedly the gap between intention and action in inheritance and estate planning. In the same study, we found that 54 per cent of high net worth women had not made a start on their wealth transfer strategy, in spite of the fact that a full 75 per cent wanted their children to be beneficiaries (against 41 per cent of partners/spouses). Likewise, our “Global Entrepreneur Report” commissioned by BNP Paribas Wealth Management found that 39 per cent of female entrepreneurs wanted their business to pass to a family member.

This lack of action is worrisome for any woman, but particularly for the region’s dynamic female entrepreneurs, who may well be managing complex family dynamics besides. 

Navigating choppy seas
Our Entrepreneur Report also suggests that there is much potential for a discretionary management model to grow, it currently accounts for only 7 per cent of female entrepreneurs’ relationships. Of course, there will be many enthusiastic “hands-on” investors amongst the 24 per cent self-directed and 69 per cent of advisory clients who emerged in our sample. However, we can guess that the intensity of monitoring today’s investment environment has also become a burden too far for many women.
 

Divergence on risk 
Wealth managers need to be aware of a full spectrum of risk appetites, as well as knowledge and confidence levels. 

As the report highlighted, women are generally thought to share a degree of heightened risk awareness (if not outright risk aversion) that might be far-reaching across their careers, business trajectories and investment portfolios too. 

That said, the research we conducted for BNP Paribas Wealth Management among the region’s female entrepreneurs actually found them less likely to deem asset classes like stocks, private equity, hedge funds and angel investments as “very risky” than APAC male entrepreneurs. They were also more likely to see opportunity in currency fluctuations and market volatility than men. 

At the other end of the spectrum are women who are wealthy, but potentially far from being won over by wealth management, and likely to be lovers of property over portfolios. Interestingly, our research indicates a need for better diversification for some clients at every point of this spectrum. Private equity seems to be particularly fertile ground for development.

Along with potential for strong messaging on discretionary management and enhanced diversification, is room for ESG to grow. Although our research with BNP Paribas Wealth Management found that APAC females are more likely to have ESG investments than APAC males (44 per cent vs 37 per cent), they were less likely than global peers (44 per cent vs 55 per cent). ESG concerns have, of course, shot up the agenda in the wake of the coronavirus pandemic and can potentially be an ideal way to win the hearts and minds of prospective clients – particularly the socially conscious Next Gen.

All in all, our analyses confirm this report’s overarching theme: that while wealth managers should certainly be making every effort to develop female-centric strategies, success depends on heterogeneity of approaches and effective micro-segmentation rather than easy answers and thinking in a reductive way.

(Winning Women in Asia-Pacific is a must-read intelligence for all manner of industry professionals, from client-facing advisors to business leaders. Download your free copy today.)

Burckart may be contacted via: caroline.burkart@aon.com