The Contribution of Family Businesses

Businesses have faced unprecedented challenges over the last 18 months. The pandemic, and consequent lockdowns have strained supply chains, disrupted production and limited the availability of workforces.

Despite these challenges, businesses have played a vital role in supporting their communities, and none more so than family businesses. Family businesses are rooted in their local communities, provide a long term, sustainable business model and exemplify how business can be a force for good in society.

This is why the Institute for Family Business started Family Business Week - as a way to highlight and celebrate family businesses.

Family owned businesses have been at the heart of the nation’s recovery from the pandemic. Family owned firms constitute 86.3% of businesses in the U.K. in 2019. They are a vital source of employment, employing approximately 14.2 million people in the U.K. or 39.9% of the workforce!

Family businesses contribute approximately £205 billion in taxes every year - a vital contribution to the national economy and to public services.

The construction sector and the professional, scientific and technical sectors make up over one third of all family businesses, and the wholesale and retail sectors constitute another sizeable proportion.

16.4% of family firms are led by women and 77% of family run firms have at least one female director.

Family run businesses tend to focus their investments on the long term. They are deeply committed to ensuring the long term viability of their business

This approach applies not just to the wellbeing of the business but to the impact of the business on the environment through its carbon footprint. Family businesses are committed to driving down their own emissions in line with the UK’s commitments to Net Zero.

As an organisation the IFB encourage our members to sign up to the Family Business Sustainability Pledge led by the Family Business Network group and UNCTAD in line with the UN’s Sustainable Development Goals (SDGs).

Family business owners recognise that their workforce is their most valuable asset. The pandemic has only reaffirmed this perspective. Family businesses invest in their workforce by prioritising skills and training opportunities, helping their staff to develop the skills they need for a fruitful career. This is reflected in the lower turnover rate the family businesses experience in relation to non-family businesses.

As we recover from the pandemic, family businesses will be at the forefront of the economic and social revival as we “build back better” as a nation.  And that’s why we’ve been celebrating this Family Business Week.