No Match Found
Some entrepreneurs will undoubtedly have been left in confusion after Budget Day. The government does not seem to use the full potential of family businesses and that is a missed opportunity. Non-listed companies - of which seventy per cent are family businesses - have an important key to the challenges we face in the long term, as an economic backbone and as innovators.
By Renate de Lange, member of the PwC board of directors, and Niels Govers, PwC partner working in the Family Business practice
The government is rightly trying to dampen optimism about the Dutch economy slightly. Public finances, unemployment and average purchasing power are going well, but the United States and China are now waging a trade war and Brexit is coming. These developments undoubtedly have a major impact on a trading country like ours. In addition, we are confronted with challenges such as climate change, the lack of trust in governments and other institutions, and technological progress, which is still moving too slowly in our country.
The government also sees this and is taking control by establishing an investment fund for projects in the field of knowledge development, innovation and infrastructure. But the government should not forget dialogue with the business community when choosing projects. Companies are an important source of knowledge and often have relevant experiences. Discussions with our customers also show that more and more companies want to contribute towards solving the nitrogen issue or to encouraging a circular economy. Use this.
More and more companies worldwide are rethinking their right to exist, their purpose, and recognising that creating shareholder value in the short term is no longer relevant in these times. Companies are also trying to secure their right to exist in the long term, inspired by the United Nations’ sustainable development goals (SDGs) and through, among other things, the ESG (Environmental, Social & Governance) framework. For themselves and for their environment.
It is a fact that family businesses are value-driven from their core and are focused on the long term. Previous studies by PwC showed that family businesses feel responsible for a better world and work towards that. So doing, they make an important contribution to the objectives that the Dutch government and the European Commission have set for the coming years. Family businesses are focused on long-term continuity, creating jobs, investing in research and development, are committed to sustainable business operations, work to prevent children leaving school early, and tackle poverty and social exclusion.
Other PwC studies showed that family businesses in Europe invest around 13 per cent of their total sales in research and development, making an important contribution to the innovative power of the Netherlands and Europe.
Family businesses are therefore important for the Dutch economy and should not be forgotten in the government’s plans with the aforementioned challenges on the horizon. Maintaining the Dutch scheme for business succession (the so-called BOR) is an item that is high on the so-called ‘agenda of owners’ for example. The BOR contributes to the continuity of the family business and facilitates the transfer from one generation to another. A cutback in the scheme can jeopardise that continuity.
Furthermore, some smaller family businesses are struggling to find the right staff with the right skills. The government could help think about setting up scalable courses and additional training opportunities and training programmes.
If things are going to go less well economically in the future, it is important that family businesses are still the backbone of our economy. But if the government forgets that we desperately need each other, this will not only jeopardise the development and resilience of family businesses but it will also become more difficult for the Netherlands to realise its sustainability and innovation ambitions.