Leaders of $100 million family businesses say they and Britain are conditionally better off in the European Union in the week of the controversial referendum.
An overwhelming 75% of principal owners, chief executives and trusted advisers said the United Kingdom should stay in the EU, in our exclusive survey of the global Campden Wealth community.
“A strong united EU is needed for world peace,” a Remain-voting, Europe based principal of a $500 million to $1 bilion family business said.
“Without a strong EU, China and US will run the show.”
A Europe based principal of a $200 million to $500 million family office voted Leave but signaled how divisive the referendum was for many survey respondents: “My heart is for leaving, my wallet is for remaining.”
A fellow Europe based owner principal of a $500 million to $1 billion family office voted Remain but echoed the sentiment: “My heart says out but my head says in - head rules heart!”
An adviser to Nordic and Irish families and family offices said he voted to Leave with a condition: “The government should then take steps to make UK more family business and family office friendly.”
There were also signs of impatience with Britain's turbulent relationship with the EU from outside Europe.
A family office principal in Asia bluntly said: “All leave or all stay.”
US based Deason Capital Services managing director Scott Letier supported Remain. However, the EU “really needs to change - either commit to a continent wide economic union where there are true political ties that bind or abandon the entire experiment.”
The majority of 25 (47%) and 21 (40%) respondents respectively said the impact of Brexit on their family business would be either “Negative” or “Neutral”.
“For the local sales of the local production, neutral, but I think the GBP would get badly hurt, creating problems for export,” a Europe based owner principal of a less than $1 billion family business said.
Just one person (2%) said departure would be “Positive” and only four (8%) said leaving would be “Very Positive”.
A Brexit-supporting Europe based family business owning principal of a $100 million to $200 million company said the UK would have the same status as Switzerland and be more attractive to family offices.
A negative impact on sterling denominated investments was predicted by 28 (53%) leaders. A “Very Negative” impact was predicted by eight (15%) while 11 (21%) felt the impact would be neutral.
Yet most of the respondents said there would be “volatility in the short term but neutral mid (to) long term”, as one European family adviser said.
Another adviser said the impact would be “possibly negative for the first 12-months but then this will change.”
The principal owner of a Europe based $500 million to $1 billion family business said UK investments outside of the EU “would compete with US, China, Russia and India for allocation room.”
A negative or neutral impact on the attractiveness of London/UK as a global hub for family businesses was the concern of 23 (43%) and a dozen (23%) family business leaders respectively.
Letier said the influence and leadership of the capital and country would be “dampened”. A Europe based Remain supporting family business owning principal said the financial services sector would “probably” be impacted.
The direst warning came from a European family office professional of a company worth under $1 billion.
Brexit “would imply a less co-ordinated and selfish approach,” he said.
“It would take a long time before we know as foreigners whether we'll again be able to trust the UK.”
However, a Leave supporting Europe based adviser said getting out of the union “could give the government the opportunity to make London and the UK an even more attractive location for family offices for global families.”
Asked to comment on the survey, Remain supporter Mark Cropper, sixth-generation chairman of the British $83 million bespoke paper maker James Cropper Plc, told CampdenFB: “Small to medium sized businesses, very often family-led like ours, are the engines of economies across Europe.
“What I would like to see is the EU ensuring we have a fair playing field against global corporates and that behaving with propriety - whether with respect to environment, human welfare or transparent taxation and governance - is both rewarded and enforced.”
Who participated in the survey?
53 of 111 respondents said their family's estimated net worth was more than $100 million.
36 respondents (68%) said their family business or head office was headquartered in Europe with eight (15%) in North America, five (9%) in Asia and one (2%) from Latin America. Zero respondents from Australasia.
15 (28%) described their position as Family Business Owner Principal, 10 (19%) were Trusted Family Advisers, nine (17%) were Family Office Principals, six (11%) were Family Office Professionals – CEO and CIO, another six (11%) were Non Family CEOs or Board Directors, five (9%) were supervisers, multi-family office directors or similar, while two (4%) were family members.
47 (90%) were male, five (10%) were female.