The Great Wealth Transfer: an impact revolution, and its implications for business

As The Great Wealth Transfer unfolds, trillions of dollars are set to move into the hands of new generations of investors, which will have a significant impact on how wealth is managed, invested and distributed. For corporates, family offices, fund managers, and high-net-worth investors, this transformation represents an opportunity to align with a new era of purpose-driven investing.

In Australia, family offices have emerged as the largest category of limited partners investor type by number, reflecting their growing influence in shaping investment trends. While private equity, including venture capital, remains the most favoured asset class, there is a shift in strategy, with family offices showing an increasing interest in growth equity. Regional investment preferences also remain close to home, with a strong focus on opportunities within the Asia-Pacific region, including Australia. New generations of investors, increasingly women, as key inheritors of this family wealth transfer, are expected to play a pivotal role in reshaping capital allocation, driving demand for strategies that prioritise long-term value creation, sustainability, and measurable impact.

The Great Wealth Transfer: a catalyst for investment transformation

The Great Wealth Transfer refers to the unprecedented intergenerational movement of wealth, as Baby Boomers pass on their assets to Millennials and Gen X. By some estimates, nearly $124 trillion in assets will change hands globally through 2048. In the United States alone, $30 trillion is expected to be inherited by women over the next ten years, with women projected to control more than 60% of this wealth by 2025.

This shift is being driven by several key factors:

• Longevity: Women’s longer life expectancy often positions them as primary beneficiaries of spousal and familial wealth.

• Financial independence: Later-in-life divorces and delayed marriages are resulting in more women managing wealth autonomously.

• Education and leadership: Increasing numbers of women are earning advanced degrees and stepping into senior corporate and entrepreneurial roles, accelerating their wealth accumulation.

• Entrepreneurship: Women are founding businesses and leading organisations at unprecedented rates, expanding their influence on the financial system.

How generational change is redefining wealth and the future of investing

New generations of investors are not just inheriting wealth – they are transforming how it is used to address societal challenges and reshape investment strategies and capital markets. For example, research consistently shows that new generation investors are increasingly bringing a values-driven, long-term perspective to investing, focusing on measurable outcomes, systemic change, and sustainable growth. This shift is redefining the financial landscape in several key ways:

• Purpose-Driven Investing: Investors are aligning their portfolios with their values, prioritising investments in businesses and ventures that deliver both financial returns and positive social or environmental outcomes.

• Focus on Equity: nvestors are directing capital toward initiatives that address systemic inequities, such as gender equality, education access, and healthcare reform.

• Collaborative Models: Investors are leveraging networks and partnerships to amplify the impact of their investments, pooling resources to tackle complex global challenges.

• Sustainability and Innovation: Investors are prioritising investments in clean energy, ethical supply chains, and sustainable development, driving demand for businesses that align with these principles.

The economic impact of changing investment trends

This values-driven approach is not only transforming philanthropy but also reshaping the future of investing. As the new generation of investors channel their wealth into purpose-driven initiatives, they are influencing broader economic trends and driving demand for solutions that prioritise sustainability, equity, and innovation. Businesses are responding to this shift, recognising the growing importance of aligning with these values to remain competitive in an evolving market. This dual focus on reimagining both investment strategies and philanthropic efforts is setting the stage for a new era of purpose-driven capital. Key sectors poised to benefit include:

• Healthcare and Wellness: A focus on family health and well-being is driving investments in personalised medicine, mental health services, elder care, and preventative health solutions. These sectors are poised for growth as women prioritise holistic and innovative approaches to healthcare.

• Education and Skills Development: An emphasis on education is creating demand for edtech, lifelong learning, and initiatives that improve access to quality education for underserved communities. Investments in these areas are expected to drive innovation and close skills gaps.

• Sustainable and ethical consumer goods: As investors are reshaping consumer markets by prioritising sustainable fashion, clean beauty, and ethically sourced products. Brands that align with transparency and environmental responsibility are likely to thrive.

• Renewable energy and sustainability: A greater commitment to environmental impact is accelerating investments in clean energy, sustainable agriculture, and circular economy solutions. These sectors are benefiting from the growing demand for sustainable and ethical practices.

• Social enterprises and impact ventures: New generation investors are supporting social enterprises, women-led startups, and community-focused initiatives that address social equity and environmental challenges. Affordable housing and other impact-driven ventures are also gaining traction.

• Technology and innovation: New generation investors are driving investments in fintech for financial inclusion, healthtech innovations, and green technologies that address climate change. These areas are set to benefit from their focus on purpose-driven solutions.

• Financial services: Demand is growing for tailored financial advice and platforms that facilitate purpose-driven investments.

• Philanthropy and non-profit initiatives: New generation investors are transforming philanthropy by establishing charitable foundations and supporting social impact funds that deliver measurable outcomes. Their focus on systemic change is reshaping the non-profit landscape.

• Arts and culture: New generation investors are strong advocates for arts, culture, and heritage preservation, driving investments in creative industries like film, music, and design. These sectors are benefiting from their support for cultural enrichment.

• Childcare and family services: An increasing focus on family well-being is driving investments in innovative childcare solutions and work-life balance initiatives. Businesses offering family-friendly policies are well-positioned to benefit.

This shift in investment priorities is also influencing corporate behaviour, as businesses adapt to meet the expectations of purpose-driven investors and consumers. Companies that align with these values through transparency, diversity, and ethical practices are likely to see increased support from both investors and customers.