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5h Z9 Less than a third of family businesses have a formal plan to transition to the next generation - The Times Hub

Less than a third of family businesses have a formal plan to transition to the next generation

Less than a third of family businesses have a formal plan to transition to the next generation

Three in five Quebec family businesses wish to pass the torch to the next generation, but barely 27% of them have a formal plan to orchestrate an adequate transition.

• Read also: All the developments of the pandemic

This is what a statistical survey by Families in Business – HEC Montreal reveals, the results of which were unveiled on Thursday.

The organization’s mission, in particular, is to support family businesses in their succession process, took an interest in 443 companies of all sizes, which it presents as “essential pillars of the economy” of Quebec.

“When it comes to inheritance, the majority of family businesses neglect support linked to management, culture or human aspects. In this period of uncertainty and distancing, companies would benefit from investing in the relational aspects of the next generation, ”said Annie Veilleux, Director, Business Families – HEC Montreal, in a press release.

While 27% of family businesses have a formal plan to transition to the next generation, 30% rely on an informal plan.

Two-thirds of Quebec businesses are family-owned, which says a lot about their weight in the economy.

“Thanks to the results of this statistical survey; as well as with the advice and advice of renowned local experts, we finally have significant information representative of the challenges and needs of the diversity of business families across Quebec, ”said Luis Cisneros , academic director of the Entrepreneurship, Takeover and Business Families Pole.

Among the figures released Thursday, we learn that 97% of family businesses surveyed have a CEO member of the family. In addition to issues related to parity, succession, governance and new generations, there is of course COVID-19 which has been added to the picture.

Thus, 44.2% of family businesses have had to adapt to provide goods and services in these times of pandemic. Last April, at the height of the first wave, 70% of family business leaders were confident, and even very confident, in the sustainability of their business.

“Several studies have already confirmed that family businesses survive crises better due, in part, to their resilience,” it was indicated.

One in two family businesses has also put in place means to develop its research and development capacity since the start of the health crisis and 34.8% of companies have been able to rely on a family member who was not working in the company to meet the challenges inherent in the past year.

Mental health has grown in importance among the issues of family businesses, as in other spheres of society. Thus, 11.1% of managers said in April 2020 that they did not have very good mental health. Before the arrival of the virus that turned our lives upside down, it was 10% less. Almost 10% also indicated that they were not in good physical health.

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