AUB Observatory on Italian Family Firms

Main results of the 11th edition

Italian family businesses: smaller than German and French ones, but in recent years they have grown more and have greatly reduced the profitability gap

The AUB Observatory (AIDAF, UniCredit, Bocconi), launched in 2007 also with the support of the Italian Stock Exchange (Borsa Italiana), the Chamber of Commerce of Milan-MonzaBrianza-Lodi, and the Angelini foundation (Fondazione Angelini), compared in its eleventh edition family businesses in Italy, France and Germany. Governance is more similar than expected, but only 9 Italian family businesses exceed 5 billion in turnover, against 34 German family businesses and 21 French ones.

Italian family businesses are still too small and managed by older leaders than the German and French ones, but the profitability gap is narrowing and has virtually disappeared compared to German family businesses. Also due to the smaller dimensions, from 2012 to 2018 Italian family businesses grew more: + 50% the revenues of Italian companies, against 44% of the French ones and 38% of the German ones. As for the percentage of female directors, Italian family members triple the German family members on the executive boards.

The results of the eleventh edition of the AUB Observatory were presented on November 25th, 2019, by Guido Corbetta and Fabio Quarato of the AIDAF-EY Chair in Strategic Management in Family Business in memory of Alberto Falck. In this edition, the Observatory presented not only the analysis of all Italian family businesses with turnover in excess of 20 million euros (11,079, to be exact, 65.8% of the 16,845 Italian companies in this size class), but also a comparison of the 500 largest companies by turnover in France, Germany and Italy.

"The data on the family involvement in the governance structures in Italy, France and Germany give a more similar picture than that found in other researches," said Guido Corbetta, the professor at Bocconi who holds the Chair. Leadership (chief executive officer or executive president) is familiar in 50.5% of cases in Italy, in 41.0% of cases in France and in 34.7% of cases in Germany. On the other hand, the size and age gaps of firm leaders remain high. In Italy, there are 9 family businesses with turnover in excess of 5 billion euros, compared to 21 in France and 34 in Germany. In Italy, 33% of family business’ leaders are over the age of 70, compared to 15% of the French leaders and 9% of German ones.

Focusing on Italy, in 2018 family businesses made a smaller number of foreign direct investments (-6%), but greater in terms of size. Indeed, the turnover increased by 63.2% to 593.4 billion euro, with greater activism of larger companies: 67.7% of family businesses with revenues above 250 million euros made foreign investments, compared to 22.9% of those with revenues between 20 and 50 million. The geographical areas of investment show a wider range of action of family businesses: if in 2007 51% was in Western Europe, in 2018 the share dropped to 32%, mainly in favor of Asia and North America.

Report AUB XI