Family-owned businesses outperform non-family peers across every region and sector, recording stronger revenue growth, higher EBITDA margins, and better cash flow returns, according to a report by the Credit Suisse Research Institute (CSRI).
Family-owned businesses were found to have a strong preference for conservative growth, with less reliance on debt funding compared to non-family-owned firms, and focus on longer-term investment.
According to Credit Suisse, the longer-term focus offers family-owned firms the flexibility to focus on through-cycle growth and returns instead of quarter-to-quarter earnings.
The study also revealed higher risk-adjusted returns generated by first and second generation family-owned businesses compared to their older counterparts in the last decade. Credit Suisse believes business maturity to be the key driver in this case.
The study also found a “negligible” difference in total shareholder returns of family-owned firms with ordinary shares compared to those with special voting rights.
Credit Suisse head analyst of thematic investments Eugène Klerk said: “This year we find family-owned businesses are continuing to outperform their peers in every region, every sector, whatever their size. We believe this is down to the longer term outlook of family-owned businesses relying less on external funding and investing more in research and development.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
![](/wp-content/themes/goodlife-wp-B2B/assets/images/company-profile-unit.png)
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData“Our research on a global scale also suggests family-owned companies with special voting right structures perform relatively in line with those with ordinary shares, contrary to the fears expressed by many investors.”