Despite pandemic, largest 500 family businesses prove economic resilience despite pandemia
LONDON, Sept. 14, 2021 /PRNewswire/ -- Despite the turmoil caused by the COVID-19 pandemic, family-owned enterprises managed to keep resilient. The world's largest family business generated US$7.28 in revenues, employing 244.1 million people across 45 jurisdictions. These and other findings were published today in the publication of the report today. EY and University of St. Gallen Family Business Index 2021, Ey and the University's family business index 202021. The largest family-owned companies responded to the recent turbulence in the global economy.
While many families, especially those in hospitality and tourism industries, have felt the effects of the COVID-19 pandemic, many took the opportunity to pivot. Some organizations changed their manufacturing capabilities to create essential items like face shields and ventilators, while others supported other businesses by lending their support to innovation and an enduring sense of social responsibility. The consumer-family businesses grew a profit of on average 15,39 p.m. Overall, family-owned enterprises in the consumer sector remained a significant employer, with 56,150 people employed in average.
As for Europe, the tumult of the past year is long enduring, and a nurturing geographic environment for these organizations continues to flourish. Germany is home to 16 percent of the index's companies, due to the strongness of Germany' economy and the historic nature of family businesses settling in the country 90 percent in all Germanys are family-owned. One third of the featured family business is based in the United States, the USA boasts the highest number of family businesses (119 or 24%). These organizations contribute US$2,48t in the United States, employing 6.4 million people. Several of the largest private family-owned enterprises globally are located in the US. Five-five of the companies that hail from mainland China, Hong Kong, Taiwan, Japan and South Korea contribute 87 percent of Asia-Pacific's combined revenue. Asia is home to three of the top 20 businesses, the oldest family business in Japan the 400+ year-old Takenaka Corporation.
Growing number of organizations committing to diversity and inclusion and environmental, social and governance standards, family businesses continue to focus on these areas. A family member is 61 years old, and 80 percent of the business listed do not have family members under 40. In 2021, the share of companies with female family members on boards reached 31%. At the same time, only 5% (27) of the family businesses in the index have female CEOs, similar to 8% (41) of Fortune Global 500 companies.
Family-owned enterprises work to achieve new goals, while looking more closely at ESG commitments. At least 53% of the family businesses on the Index are reporting on formal ESG metrics. Half of those (51%) are from EMEIA, followed by companies in the Americas (30%) and Asia-Pacific (19%). ESG reporting is an opportunity to show the positive impact companies are already making. It could attract new talent, win customers and increase revenues.
"Family-owned enterprises have demonstrated tremendous resilience through the COVID-19 pandemic, prioritizing sustained workforces and pivoting when necessary to overcome new challenges. The future of the economy continues to move forward through these tumultuous times and the future continues in their best interests, further diversifying their boards, bringing the next generation into leadership roles and setting new standards when it comes to
The difficulties business families face become more complex as wealth grows over generations. This increasingly requires a professionalized approach to portfolio and asset management. Families are also engaging more non-family directors on board and top management roles."
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