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People are skeptical of inherited wealth and execs born into family businesses

Reuters/Edgar Su
Wealth is not always respected.
  • John Detrixhe
By John Detrixhe

Future of finance reporter

Published This article is more than 2 years old.

Family businesses are more respected than other types of corporations in several ways: People generally trust family firms, would rather worth for them, and are three times more willing to pay more for their services, according to a survey by Edelman.

That generosity only goes so far—respondents also think next-generation CEOs are less trustworthy than founders (a 17-percentage point gap) and that people who inherited their wealth are less deserving of it than those who originally earned it (26 percentage points), according to the online survey that sampled more than 15,000 respondents in 12 markets, from Brazil to the US.

When it comes to family businesses’ information, a founder and CEO is just about as trusted as a technical expert or an academic when communicating about the business, according to the survey. They are also seen as more respectful of local customs and are given credit for keeping profits in countries where their money is earned.

Even so, family businesses don’t get much credit in other areas: Fewer than one in three respondents see them as job creators, despite evidence that signals otherwise, and they’re seen as less likely to be long-term thinkers or innovators. And while 70% of the people in the survey think the wealthy should channel their money into philanthropy, nearly 80% think it’s usually done for self-serving purposes—such as gaining political influence, or out of vanity.

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