LONDON, Sept. 14, 2021 /PRNewswire/ -- Despite the
turmoil brought on by the COVID-19 pandemic, family-owned
enterprises have managed to stay resilient. The world's largest 500
family businesses generated US$7.28t
in revenues, employing 24.1m people
across 45 jurisdictions. These and other findings were published
today in the 2021 EY and University of St. Gallen Family
Business Index which reveals how the largest family-owned
businesses have responded to the recent turbulence in the global
economy.
While family businesses, especially those in the hospitality and
tourism industries, have felt the effects of the COVID-19 pandemic,
many took the opportunity to pivot. A number of organizations
shifted their manufacturing capabilities to create essential items
like face shields and ventilators, while others provided financial
support to other businesses, displaying their commitment to
innovation and an enduring sense of social responsibility. Consumer
family businesses in particular endured, achieving on
average US$15.39b in revenue. Overall, family-owned
enterprises in the consumer sector remained a significant employer,
employing on average 56,150 people.
In spite of the tumult of the past year, Europe continues to be a nurturing geographic
environment for these organizations. Germany is home to 16% of the companies on the
Index, reflecting the strength of the German economy and the
historic nature in which family businesses tend to settle in the
country – 90% of all businesses in Germany are family-run. One third of featured
family businesses are based in the Americas, with the US boasting
the highest number of family businesses (119 or 24%). These
organizations contribute US$2.48t in
revenue in the Americas, employing 6.4m people. Several of the biggest private
family-owned enterprises by revenue globally are located in the US.
Fifty-five of the businesses that hail from mainland China, Hong
Kong, Taiwan, Japan and South
Korea, contribute 87% (US$835b) of the combined revenue in Asia-Pacific. Asia is home to three of the top 20
businesses, as well as the oldest family business in the Index –
Japan's 400+ year-old Takenaka
Corporation.
As a growing number of organizations make commitments to
diversity and inclusion, and environmental, social and governance
(ESG) standards, family businesses continue to increasingly focus
on these areas. The average family business board member is 61
years-old, and 80% of businesses on the Index do not have family
board members under the age of 40. Bringing in the next
generation's expertise, insights, technology and digital
capabilities into the evolving customer landscape can help to
sustain growth. And as boards continue to seek to diversify,
the share of companies with female family members on boards has
improved, reaching 31% in 2021. At the same time, only 5% (27) of
the family businesses on the Index have female CEOs, similar to the
8% (41) of Fortune Global 500 companies.
Looking more closely at ESG commitments, family-owned
enterprises are working to achieve new goals. At least 53% of
family businesses on the Index are reporting against formal ESG
metrics. Half of those (51%) are from EMEIA, followed by companies
in the Americas (30%) and Asia-Pacific (19%). ESG reporting represents
an opportunity to demonstrate the positive impact companies are
already making, and potentially helps to attract new talent, win
customers and grow revenues.
Helena Robertsson, EY Global and EY EMEIA Family Enterprise and
Family Office Leader, says:
"Family-owned enterprises have shown incredible resilience through
the COVID-19 pandemic, prioritizing sustained workforces and
pivoting when necessary to overcome new challenges. As society
continues to move forward through these tumultuous times, these
businesses are well-placed to continue their legacy, further
diversifying their boards, bringing the next generation into
leadership roles and setting new standards when it comes to
engaging with ESG issues."
Josh Wei-Jun Hsueh, Assistant
Professor from the Center for Family Business at the University of
St. Gallen, says:
"As wealth grows over generations, the challenges business families
face become more complicated. This increasingly requires a
professionalized approach to portfolio and asset management.
Families are also engaging more non-family directors on boards and
top management roles."
Notes to Editors
About EY
EY exists to build a better working world, helping to create
long-term value for clients, people and society and build trust in
the capital markets.
Enabled by data and technology, diverse EY teams in over 150
countries provide trust through assurance and help clients grow,
transform and operate.
Working across assurance, consulting, law, strategy, tax and
transactions, EY teams ask better questions to find new answers for
the complex issues facing our world today.
EY refers to the global organization, and may refer to one or
more, of the member firms of Ernst & Young Global Limited, each
of which is a separate legal entity. Ernst & Young Global
Limited, a UK company limited by guarantee, does not provide
services to clients. Information about how EY collects and uses
personal data and a description of the rights individuals have
under data protection legislation are available via ey.com/privacy.
EY member firms do not practice law where prohibited by local laws.
For more information about our organization, please visit
ey.com.
This news release has been issued by EYGM Limited, a member of
the global EY organization that also does not provide any services
to clients.
About EY Family Enterprise
As trusted advisors to
ambitious business-owning families, including more than 92% of the
world's top 500 family enterprises, EY teams have the experience
and know-how to help the entire family enterprise — families, their
family business and their family office — pursue growth
opportunities while preserving values and building the family
legacy. Drawing from more than 100 years of experience supporting
the world's most entrepreneurial families, EY Family Enterprise
professionals are experienced in pinpointing and helping to
optimize the drivers that impact family businesses' growth and
longevity, preserve wealth and culture, and solidify
multigenerational legacies. ey.com/familyenterprise
About EY Private
As Advisors to the ambitious™, EY
Private professionals possess the experience and passion to support
private businesses and their owners in unlocking the full potential
of their ambitions. EY Private teams offer distinct insights born
from the long EY history of working with business owners and
entrepreneurs. These teams support the full spectrum of private
enterprises including private capital managers and investors and
the portfolio businesses they fund, business owners, family
businesses, family offices and entrepreneurs. Visit
ey.com/private
Rosie Izzi
EY Global Media Relations
+1 419 309 0443
rosie.izzi@ey.com
View original content to download
multimedia:https://www.prnewswire.com/news-releases/largest-500-family-businesses-prove-economic-resilience-despite-pandemic-301376767.html
SOURCE EY