You’ve just inherited 100 million. What do you do? Go wild? Buy a yacht? Buy ten yachts? Or take a long, hard look at where that wealth came from and decide to give it away?
“The next generation is much more conscious of the sources of their wealth,” Juliet Agnew, head of philanthropy at Barclays Private Bank, says. “They are much more self-aware and active in how they consume products and manage their wealth.” Call it wokeness of wealth or hand-wringing about inheritance, but there’s a small segment of the next generation who are wondering why they have so much money, where it came from and whether they should keep it.
This matters now in particular because we’re experiencing the greatest transfer of wealth in history. In the US alone, $16 trillion will be transferred between generations within the next decade, while last year more new billionaires made their fortunes from inheritance than from their own work.
“It’s not OK that I have so much money,” Paolo Fresia, 35, tells me. He inherited his wealth, which is in the “multiple tens of millions”, at 22 from his mother when she died of breast cancer. The family’s fortune originated from the Italian vermouth company Carpano, although he says that his mother was betrayed by his grandmother, who invested her money in ways his mother did not agree with. He doesn’t go into detail, but now he sees it as his mission to right those wrongs. “I want to uphold the name of my mum and make good for what happened,” he says.
Making good has meant taking that long, hard look in the mirror. He talks a lot about not “deserving” his wealth; there is guilt here, not helped, he says, by how the financial world deals with people like him. “The whole financial services industry is there to protect and grow your wealth,” he says. “It’s only about accumulation. They instil a fear in you that you’re going to lose it.” Before his mother died she urged him to educate himself in finance, so he studied economics and worked for Goldman Sachs. Then he discovered new “progressive” advisers, who helped him to change how he viewed his wealth. “These are increasing numbers of mission-driven B Corps that want their clients to have a positive impact,” he says. “I realised, why on earth do I need this much?”
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They calculated that he could keep up his lifestyle in London while making his money work harder, with the end goal of giving away 80 per cent of his wealth by the time he is 85, or “more if I live longer”. But he’s clear that it’s not as if he has moved into a tent and is living off food banks. “I can keep what I need — I live in a big house in London, I send my children to private school, I love to travel,” he says. “But I now maximise the impact [of my wealth] by taking real risks, by making philanthropic donations and impact investments.
I have the confidence to open my wallet and maximise impact.” For him, that means investing in companies focused on climate change, gender equality and sustainable supply chains, as well as donating to causes about which he is passionate.
Fresia has shared his experience in a new report, Guide to Giving, by Barclays Private Bank. He hopes that it will provide an example of how next-generation inheritors can go through this process. Agnew, the lead author, explains that the report aims to help clients to understand their philanthropic goals and how these can be achieved — something younger generations are asking about more and more.
“There is more willingness to do things differently from their parents and to challenge older generations,” Agnew says. “There is no one right way to do philanthropy well, but being self-aware and accountable, thinking about privilege and historical context, that’s all part of a healthy way to come up with philanthropic strategies.”
Giving away money isn’t exactly new. But thinking about the origins of wealth, about its context, is gaining traction. Some of the world’s best-known historical philanthropists — the Rockefellers, for example — made their fortunes in oil and gave away much of their wealth to education, healthcare and the arts. Last year the Rockefeller Foundation announced that it was committing more than $1 billion to advance climate change solutions — pouring money, in other words, into fixing a problem that its founders helped to create.
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On an individual level it could be as simple as checking your privilege, but some have way more privilege than most — something of which Lily Lewis, 28, is keenly aware. She grew up surrounded by serious wealth: her family, which founded River Island, has an estimated worth of £2.69 billion according to The Sunday Times Rich List 2023. But it wasn’t until a stint in a 12-step addiction recovery programme in her late teens that she fully understood what that meant. “I was faced with the extent of my privilege and how that had shaped my value system and understanding of the world,” Lewis, who has written about her experiences for Guide to Giving, says. She learnt about mental health, addiction treatment and prisons. “The more I understood about injustice, the more I saw how I benefit from unjust systems of power. Ethical philanthropy and wealth redistribution is a part of addressing that.”
She is now devoted to what she calls anti-oppressive wealth redistribution and has launched the Pocressi Initiative, a subset of her family’s charitable foundation, which partners with grassroots organisations working in abstinence-based addiction treatment. She also works with Patriotic Millionaires and Resource Justice, which address equitable taxation and wealth distribution.
Tax, of course, could — should — play a huge part in all this. “Philanthropic donations are a drop in the ocean compared to what even quite minor tax increases on the richest in society would provide,” Lewis says. Patriotic Millionaires is calling for a hike in taxation for the super-rich — and its members aren’t limited to millennials. They include Guy Singh-Watson, founder of Riverford Organic Farmers; Graham Hobson, founder of Photobox; the Perry family, from the posh ready-meal business Cook; and Ian Gregg, whose father founded Greggs.
“At the moment philanthropic donations amount to about £10 billion per year,” Lewis says. “A wealth tax of 1 to 2 per cent on assets over £10 million, which would affect only the wealthiest in the UK, would raise more than double that. Closing tax avoidance loopholes would raise much more than this.”
The problem, as Fresia highlights, is that most financial advisers tell their clients how to pay less tax, not more. Lewis agrees with Fresia that there is a culture of fear around protecting wealth and sticking to traditional methods of philanthropy which ignore the context of where the money has come from. Which is why, she says, “more and more younger people are realising that mainstream philanthropy organisations and advisers aren’t for them”. Instead, they are turning to “progressive” advisers such as Ten Years’ Time and the Good Ancestor Movement, which help people to translate their values into wealth redistribution.
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Agnew sees this as part of a more holistic approach. “The next generation want to align their values across investments and philanthropy,” she says, adding that they are influencing the older generations too. “Topics like accountability, equity and self-awareness weren’t talked about ten years ago. But we want to help those conversations [between generations] about what it means to think about power and accountability. We don’t want people to feel bad, or feel shame. Really, it’s about inspiring people and equipping them to be more sophisticated as a modern donor.”
Fresia emphasises the importance of educating yourself. “Look at organisations like the Good Ancestor Movement, talk to peers, find progressive advisers and get really good advice to come to terms with your privilege,” he says. “And get some financial education.” He suggests courses by Toniic and the Center for Sustainable Finance and Private Wealth, which can help to cut through the greenwash and financial jargon. There is much to be learnt from the younger generation too, who are more interested in connection and self-education than their predecessors, Agnew suggests. “They’re reading about the issues and have more of an interest in and appetite for learning. And they’re more concerned about getting it wrong,” she says.
It all comes down to equality and social justice — to the haves realising that they have a hell of a lot more than the have-nots and should be doing something about it. And it needn’t involve devastating levels of shame or guilt, rather a careful examination and a rethink of what we need to be happy and fulfilled. As Fresia puts it: “I still have way more money than I need or deserve. The rest will be redistributed because, well, I don’t need it.”
