Asia-Pacific is fast becoming the centre of family business growth in the world economy. In Family Capital’s annual ranking of the top 750, the number of family businesses from the region grew by 15 from last year’s ranking, whereas those from Europe fell by 17.
Now in its third year, the Family Capital 750 continues to underline the importance of family businesses to the resilience of the world economy. As an aggregate, the 750 companies had revenues of $10.3 trillion in 2019, up from $9.1 trillion in 2018. They employed 33.6 million people, compared with 30.5 million in 2018.
Of course, this year’s survey hasn’t captured the effects of the Covid-19 pandemic on these companies results. The survey indicates these businesses entered 2020 with solid balance sheets, suggesting they were probably in a better position to weather the Covid pandemic than many of their non-family business counterparts. Indeed, evidence of this is outlined in other studies.
“Family Businesses continue to be the engine for growth and job creation,” says Peter Englisch, global family business leader for PwC. “This is good news because family businesses represent the stability, innovation and long-term commitment that we need for a post Covid recovery and addressing the future challenges of more sustainable business practices.”
Although Asia-Pacific has become important in the world of family businesses, European family businesses still make up the biggest share of the 750, comprising 298. Asia-Pacific and North America each have 188 companies on the ranking.
“There’s no doubt North America and Europe are still very important centres for family business activity, but the rise of the Asian family business is underlined by the highest number of new entrants in the ranking,” says Johannes Rettig, director, business development entrepreneurial & private business at PwC.
“This doesn’t come as a surprise but reflects the dynamic economy of the region. This trend will challenge the dominance of European and North American family businesses not only in terms of economic relevance but also their culture and values.”
From a country perspective, the US remains the dominant centre for the world’s biggest family businesses, comprising 166, with Germany the next largest centre, with 96. However, Germany saw 12 companies fewer on this year’s ranking than last year’s 750.
“The Top 750 Family Business ranking provides an impressive overview of the economic and societal impact that family businesses have, globally,” says Peter Vogel, professor of family business and entrepreneurship at IMD Business School in Switzerland.
“Certain trends are quite pronounced, such as the increase in listed firms from Asia, a drop in European firms and especially the German Mittelstand, as well as the 20% increase of the revenue threshold to even appear on the list, signifying that family businesses have fared pretty well over the past years.
“Since this list is based on economic data pre-Covid, I expect these trends to be significantly magnified in the next edition of the ranking, with a much greater representation from Asian family businesses and a further drop of European mid-sized family businesses.”
To qualify for the 750, family businesses needed to have annual revenues of $2.6 billion compared with $2.2 billion last year.
In order to qualify for the ranking, the family or group of families would have to control at least 50% of the voting shares in a privately held company and at least 30% of the voting rights in a publicly listed company.
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|wdt_ID||Rank||Company||Public/Private||Family Owners||Shareholder Percentage||Region||Country||Sector||Founded||Market Cap||2019 Revenues||Employees|
|1||1||Walmart Inc.||Public||Walton||48.5||North America||United States||Food and Staples Retailing||1945||407,841.6||514,405.0||2,200,000|
|2||2||Volkswagen AG||Public||Piech and Porsche||31.3||Europe||Germany||Automobiles||1937||99,846.6||283,505.8||671,205|
|3||3||Berkshire Hathaway Inc.||Public||Buffett||38.3||North America||United States||Diversified Financial Services||1955||543,678.5||254,616.0||391,500|
|4||4||Exor N.V.||Public||Agnelli||55.3||Europe||Netherlands||Diversified Financial Services||1899||18,719.6||160,179.6||268,979|
|5||5||Ford Motor Company||Public||Ford||40.0||North America||United States||Automobiles||1903||34,970.4||155,900.0||190,000|
|6||6||LG Group||Public||Koo||36.4||Asia-Pacific||South Korea||Industrial Conglomerates||1947||14,132.5||147,200.0||226,000|
|7||7||SK Group||Public||Chey||38.3||Asia-Pacific||South Korea||Industrial Conglomerates||1953||11,558.9||139,000.0||107,983|
|8||8||PJSC LUKOIL||Public||Alekperov||30.0||Europe||Russia||Oil, Gas and Consumable Fuels||1993||45,599.9||124,030.0||101,000|
|9||9||Schwarz Group (incl. Kaufland, Lidl)||Private||Schwarz||100.0||Europe||Germany||Food and Staples Retailing||1930||117,072.6||458,000|
|10||10||Bayerische Motoren Werke Aktiengesellschaft||Public||Klatten and Quandt||42.7||Europe||Germany||Automobiles||1916||57,029.0||116,945.3||133,778|
|Rank||Company||Public/Private||Family Owners||Shareholder Percentage||Region||Country||Sector||Founded||Market Cap||2019 Revenues||Employees|