According to the PwC Global Family survey, only 58% of family businesses in Romania say they want the business to remain in the family in the long term, compared to 74% in Central and Eastern Europe (CEE) and 66% globally. Business Survey. In addition, only 63% of family businesses in Romania have plans for the future of the business, such as shareholder agreements (39%), dividend policy (39%), emergency and contingency procedures (15%) or a will (12%). . By comparison, 69% of family businesses in the CEE and 81% worldwide have such arrangements.

The main long-term personal goals of family business owners in Romania are to protect the business as the most important family asset (87%) and to receive dividends for family members (84%).

“In Romania, the family business ecosystem is still young, 90% of these companies belong to the first generation and only 9% to the second generation, compared to other countries in Central and Eastern Europe or around the world, where there are companies that have reached the third or fourth generation. Succession planning is a way to lay a solid foundation for the future, to identify new ways of business development and growth. For example, bringing in the next generation of family members with digital or sustainability knowledge can lead to the business transformation necessary to survive in the future,” said Dinu Bumbeca, Managing Partner of PwC in Romania.

At the same time, the level of trust between family members is generally considered high: 74% of respondents claim that there is a family connection in the management of the company (compared to 59% worldwide).

“Problem-free succession thought out to the smallest detail is a guarantee that the future of the family and the company is and will be stable. The process is not only focused on simply transferring property to the next generation or securing wealth by establishing an appropriate legal structure, but also involves establishing communication rules, establishing proper family governance, and passing on knowledge, experience, and values ​​to the younger generation. On the other hand, the decision to sell a business can be made when it has to move to another level of development, and the owners do not have the opportunity to finance the necessary investments or they need a strategic partner for this,” said George Urece, director of PwC Romania.

Other conclusions of the report

• The majority of family businesses in Romania (82%) increased their sales in the last fiscal year, up from 55% in 2021, a year still affected by the pandemic, a level similar to that recorded in CEE (83%) and higher percentage of 71% registered worldwide.

• At the same time, growth targets are also ambitious for the next two years: 27% of family businesses in Romania expect fast and aggressive growth, compared to 20% in CEE and 14% globally.

• While growth and profits are considered important, most agree that profits should not come at the expense of customers or employees.

• Most family businesses in Romania have goals and objectives for customer satisfaction and growth, but only a minority have diversity, inclusion and social impact.

• The main priorities of family businesses in Romania in the next two years are to increase customer loyalty and introduce new products and services (both priorities are much higher than in CEE and the global average). The main priority groups are customers and shareholders, followed by employees.

As part of the Global Family Business Survey, 2043 interviews were conducted with family companies from 82 countries of the world, including Romania. The purpose of the survey is to understand what family business representatives think about current problems.

Article supported by PwC Romania