Lombard Odier has found younger investors in the Middle East are more likely to seek investments that comply with their values, including in Islamic and sustainability-focussed assets, while seeking a wealth management partner that shares their investment principles.
The global wealth manager surveyed 300 high net-worth individuals (HNWIs), of which 200 were under the age of 40, and found 91% said they already allocate to Islamic investments, while 88% plan to increase their allocations to sustainable assets.
Some 73% of respondents believe that they can generate improved returns through ventures that drive the transition to a net-zero economy, and 74% believe that new business opportunities will be found in sustainable sectors in the region.
Adherence to Islamic principles is also a key area of focus. While the families of 85% of young respondents share traditional Middle Eastern values based on religious or cultural principles, 31% said those traditional values are updated for the present day. This contrasts with older investors, 79% of which said their values are exclusively traditional.
There is also a divergence in the objectives of younger and older investors in preserving and growing their wealth. Younger investors have a greater focus on improving their lifestyle and remaining wealthy compared to older investors over the age of 40 (45% vs 16%), who are more interested in their financial and reputational legacy.
The survey also highlighted the geographic spread of younger respondents’ investments. Some 89% of younger HNWIs hold their assets in the Middle East and intend to keep them there over the next five years, while the remaining 11% keep their assets in Europe (5%), North America (4%) and Asia Pacific (2%).
Arnaud Leclercq, head of new markets at Lombard Odier, said: “The latest results from our Middle East investor views 2022 survey reveal a consensus emerging between older and younger investors in several areas, but specifically in values-based investing.
“The next generation’s enthusiasm for Islamic and sustainable investing, and their keenness to work with expert financial advisers that share their values, is very encouraging.
“We also observed a keen focus on regional investing, highlighting the sheer opportunity the Middle East offers for maintaining and accumulating greater wealth.
“At Lombard Odier, helping businesses to plan, organise, protect and transfer their wealth is shaped by half a century’s experience in the Middle East. We look forward to using that experience to help the next generation plan their future with confidence.”