UK family businesses are more than twice as likely as their counterparts in France, Germany and Italy to change ownership over time. This is the headline finding from a report entitled Evolution of Family Capitalism, which made a comparative study 4,000 companies in the four countries.
Between 1996 and 2006, only 30% of top UK family firms remained under control of the same family – compared to 53% in Germany, 59% in France and 71% in Italy.
The reasons for this, according to the researchers, are that 42% of family businesses in the UK underwent takeovers and 28% became widely-held businesses, as the family shareholders were diluted. In spite of this, family companies in the UK are performing as well as their non-family peers.
"In the UK a large proportion of family firms naturally evolve into widely-held firms as they grow bigger and older," said Grant Gordon (pictured), director general of UK-based Institute for Family Business who commissioned the report. "The sector is a spawning ground for the capital markets with growing family firms feeding through to the Stock Exchange as businesses seek to develop."
Following the UK's lead, the study shows that widely-held firms have also become more common in continental Europe. This is particularly the case in France and Germany, where extensive reforms ranging from investor protection, taxation and financial liberalisation have led to more harmonised regulation across Europe.