Family offices in Qatar have demonstrated versatility and resiliency in coping with a diverse range of challenges wrought by the Covid-19 pandemic, according to a survey by Deloitte.
The Deloitte Middle East Qatar Family Office survey, was conducted recently and provides insight from 35 of the most prominent family groups across Qatar.
“Family offices continue to be a driving force in the development and growth of Qatar and across the Middle East. The recent pandemic has dramatically changed the operating environment, creating major challenges and for some, unique opportunities across the entire family ecosystem – the family, the operating businesses and investments, and private wealth.
“In response to these changes, families had to quickly adapt business models and strategies to ensure continuity and provide a platform to thrive,” said Midhat Salha, partner, Deloitte Middle East.
He said, “Overall, the outlook from the community is largely one of optimism; 18% of respondents report having already returned to previous levels of business activity, with another 50% expecting a return to pre-crisis or near-normal levels of operations within 12 months.”
Around half of the respondents plan to invest within the next 18 months, in many respects within new industries and across the value chain, Salha pointed out. In terms of risk factors, declining oil prices and ongoing liquidity issues ranked as the most prevalent, he continued.
“To prepare for this, many families have revisited and adjusted strategies. Work is still required in this space. Not surprisingly, cost reduction stands out as the highest priority across almost all families.
“There is a focus on developing talent within families and preparing the next generation with 11% believing their next generation were ready to take the reins now, but over 50% anticipating they will be ready within the next five years,” Salha explained.
According to the survey, optimism has emerged as a dominant theme despite the ongoing challenges. Revenue impact reflects reductions in excess of 10% compared to 2019 levels for 70% of the families, with approximately half of these suffering decreases of more than 20%.
“Priorities have been reviewed by most families interviewed and were deemed either fit for purpose or have been addressed quickly. Technology remains the area where most families see a need for review/change to adapt to the new economic landscape. Group strategy stands out as the area needing immediate attention and change.
“Responses confirm that the medium-term strategy has been altered by 80% of families, with trends visible in the pursuit of leaner and more agile operations and desire to move into new products/markets,” the survey revealed.
David Bowen, Head of Family Office Consulting, Deloitte UK, said: “For many, Covid-19 shone the light on governance and risk in the family office. Key individuals and decision makers’ incapacitation impacted the ability to make decisions and to implement them.
"This has subsequently led to a real focus by families to simplify structures that hold and advise the families on the wealth along the decision-making process.”
The Deloitte Middle East Qatar Family Office survey, was conducted recently and provides insight from 35 of the most prominent family groups across Qatar.
“Family offices continue to be a driving force in the development and growth of Qatar and across the Middle East. The recent pandemic has dramatically changed the operating environment, creating major challenges and for some, unique opportunities across the entire family ecosystem – the family, the operating businesses and investments, and private wealth.
“In response to these changes, families had to quickly adapt business models and strategies to ensure continuity and provide a platform to thrive,” said Midhat Salha, partner, Deloitte Middle East.
He said, “Overall, the outlook from the community is largely one of optimism; 18% of respondents report having already returned to previous levels of business activity, with another 50% expecting a return to pre-crisis or near-normal levels of operations within 12 months.”
Around half of the respondents plan to invest within the next 18 months, in many respects within new industries and across the value chain, Salha pointed out. In terms of risk factors, declining oil prices and ongoing liquidity issues ranked as the most prevalent, he continued.
“To prepare for this, many families have revisited and adjusted strategies. Work is still required in this space. Not surprisingly, cost reduction stands out as the highest priority across almost all families.
“There is a focus on developing talent within families and preparing the next generation with 11% believing their next generation were ready to take the reins now, but over 50% anticipating they will be ready within the next five years,” Salha explained.
According to the survey, optimism has emerged as a dominant theme despite the ongoing challenges. Revenue impact reflects reductions in excess of 10% compared to 2019 levels for 70% of the families, with approximately half of these suffering decreases of more than 20%.
“Priorities have been reviewed by most families interviewed and were deemed either fit for purpose or have been addressed quickly. Technology remains the area where most families see a need for review/change to adapt to the new economic landscape. Group strategy stands out as the area needing immediate attention and change.
“Responses confirm that the medium-term strategy has been altered by 80% of families, with trends visible in the pursuit of leaner and more agile operations and desire to move into new products/markets,” the survey revealed.
David Bowen, Head of Family Office Consulting, Deloitte UK, said: “For many, Covid-19 shone the light on governance and risk in the family office. Key individuals and decision makers’ incapacitation impacted the ability to make decisions and to implement them.
"This has subsequently led to a real focus by families to simplify structures that hold and advise the families on the wealth along the decision-making process.”