Irish family businesses are optimistic about future growth, according to the PwC 2023 Irish Family Business Survey.
84% of Irish family businesses reported growth in their latest financial year, with 55% reporting double-digit growth and 82% reporting that they expect to grow in the coming two years.
PwC’s 2023 Family Business report ‘Transform to Build Trust’ polled more than 2,000 Irish and global family businesses across 82 countries.
“The message is clear, for family businesses to survive, they must transform. And that transformation needs to be now”
It reveals double-digit sales growth of 55% for Irish family businesses in the last financial year, up from 22% in 2021.
Irish family businesses report higher levels of sales growth in the last financial year compared to global peers (Ireland:84%; Global: 71%). Irish family firms also have greater growth ambitions for the next two years compared to global peers (Ireland: 82%; Global: 77%).
Less than half (47%) said that reducing their organisation’s carbon footprint is a priority in the next two years, while up from 35% two years ago when the survey last took place, it is far ahead of global peers (20%). Only 16% have a well advanced Environmental, Social, Governance (ESG) strategy (Global: 15%)
Less than four out of ten (39%) stated that they have strong digital capabilities (Global: 42%).
Irish family businesses are more likely to include women on their Boards than global peers (Ireland: 74%; Global: 69%).
76% of Irish family businesses say employee trust is essential – yet only 24% say that attracting and retaining key talent is a top overall business priority.
Only 16% will prioritise improving performance on diversity in the next two years (Global: 11%).
Less than half (42%) stated that offering staff incentives across all employee levels is at an advanced stage (Global: 33%).
“Irish family businesses are confident about the future and have proven that they are resilient, having the ability to deal with change in a challenging landscape,” said John Dillon, leader PwC Private.
“To continue this trajectory, firms will need to focus on continuing to build trust across all levels and amongst all stakeholders in the business. There is also clear evidence from the survey that being advanced in having an agreed and well communicated ESG strategy correlates strongly with success and other positive attributes such as improved financial performance. Irish family businesses have a great opportunity in this area. Businesses that are advanced in ESG strategies have an opportunity to gain a competitive advantage in the face of continued disruption.”
Family businesses have more to do on digital and diversity
The research highlights that having a more diverse Board is strongly associated with stronger financial performance. The Boards of Irish family firms (74%) are more likely to include women on their Boards than their global peers (Global: 69%). However, a third (32%) of Irish respondents have no-one from a different industry background on their Boards (Global: 26%) and over half (55%) have no one under the age of 40 on it (Global: 57%).
Irish survey respondents admit they have more to do on diversity. Just 16% of Irish family firms have a well advanced commitment to progress diversity and inclusion (Global:21%) and only a third (34%) have a person or a team responsible for diversity and inclusion (Global: 34%).
“While market pressures and rising costs mean survival is a key priority for Irish family businesses, our latest data shows that those family businesses which are focused on digital transformation and diversity are reaping the rewards. Irish family businesses have more to do on digital transformation and diversity,” said Mairead Harbron, Partner, PwC Private.
“Now more than ever, building competence and achieving strong financial performance are linked to corporate responsibility. The message is clear, for family businesses to survive, they must transform. And that transformation needs to be now.”