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Family Business Survey 2021—Canadian insights

An approach for lasting family business success

At a glance

  • Growth goals in Canada are ambitious for 2022 but more cautious for 2021. While two-thirds of Canadian family businesses expect to see growth in 2021, 9 out of 10 anticipate growth by 2022.
  • Canadian family businesses have prioritized boosting their digital capabilities—much more than their North American counterparts in the U.S. and Mexico, who are instead focused on expansion and diversification.
  • Protecting the business as the most important family asset is top of mind, and sustainability is an opportunity to build a business that will stand the test of time.

The unprecedented events of the past year have presented family businesses with enormous challenges. In our Canadian insights from the Global Family Business Survey 2021*, we reveal the outlook of Canadian family business leaders and how they compare to North American findings. Although many have shown significant resilience and are optimistic for growth through 2022, now is the time to embrace a new formula for lasting family business success. Today’s family businesses require an approach based on becoming fit for growth, powering digital transformation, developing sustainability goals and empowering the next generation of leaders.

Economic resilience looking toward 2022

The COVID-19 pandemic has been a test of resilience for Canadian organizations, and family businesses are meeting the challenge and have ambitious growth aims in 2022. Two-thirds of Canadian family businesses expect to see growth in 2021 (compared with 74% in North America), and 89% expect to see growth in 2022 (compared with 92%  in North America). Family businesses are also taking a people-first approach, prioritizing the well-being of their employees. In Canada, 88% are enabling staff to work from home, and a robust 64% are providing staff emotional/mental health support (compared to 56% in North America and 45% globally).

Family businesses have proven adaptable, and as they plan for growth in the years ahead, they have a powerful opportunity to differentiate themselves from the competition and position their business to succeed in an uncertain future. So is your business fit for growth?

Advancing our digital priorities

Key priorities over the next two years—Canada


Increasing use of new technologies
%
Improving digital capabilities
%
Expanding into new markets / client segments
%
Increasing next gen involvement in decision making / mgmt
%
Rethinking / changing / adapting the business model
%
Introducing new products services
%
Protecting our core business - covering costs / survival
%
Increasing investments in innovation and R&D
%
Pursuing strategic acquisitions / mergers
%
Reimagining our approach to how we measure success
%
Increasing collaboration with other companies
%
Increasing organization's social responsibility
%
Supporting local community via increased investment / activity
%
Reducing organisation's carbon footprint
%
Reducing dependencies along the value chain
%

The pandemic has proved the importance of strong digital capabilities as digitally enabled businesses have been better able to adapt to employee and customer needs. Building on this, the top priorities for Canadian family businesses are increasing the use of new technologies and advancing their digital agendas, which differs from our North American counterparts, who are more focused on expansion and diversification efforts.

And while 77% of Canadians want to use technology to drive efficiencies and collaboration in the business, only 40% plan to develop a clear and documented road map for digital transformation. How do you break free of barriers to achieve digital transformation? By understanding the value of data, upskilling your workforce and recognizing that transformation must be a part of a cultural shift.

Leading on sustainability

Most family business owners want to create an enduring asset for future generations. We’re a world leader in social responsibility efforts, as 91% of Canadian businesses are involved in some form of social responsibility (81% globally), including 56% who say they engage in philanthropy (42% globally). Legacy matters (it’s top of mind for 67% of Canadians), and sustainability is an opportunity for them to build a business that will stay the test of time. What’s more, 44% of Canadian family businesses (50% globally) believe they have a responsibility to fight climate change and its related consequences. 

And 50% of Canadian family businesses say there’s an opportunity to lead the way in sustainable business practices. This may be led by younger generations, who are a powerful force behind sustainability and are more likely to embed sustainability in decision-making and have a comprehensive strategy.

Agreement on sustainability—Canada vs. the world


Canada
Global

We contribute strongly to community
%
%
We have a responsibility to fight climate change and its related consequences
%
%
We ensure sustainability is at the heart of everything we do
%
%
We have a developed and communicated sustainability strategy which informs all of our decisions
%
%

Protecting a legacy with succession planning

There’s a big generational shift coming, with half of the first- generation Canadian family businesses expecting the next generation will be the majority shareholders in five years’ time. And Canadian family businesses are concerned about keeping their business in the family, with 78% seeing the business as the most important family asset. 

Anticipating their generational shift, succession planning is key—but only 34% of Canadian family businesses have a robust, documented and communicated succession plan in place. Topics like succession can be emotional, making them difficult to navigate and, as a result, tempting to avoid. Many families want to keep the discussion of these sensitive issues among themselves, but they agree that they often need professional support and moderation to address them properly.


Current shareholder majority in Canada 

Shareholder majority in Canada in 5 years time

Aligning on values and the next generation

When talking about succession, it’s important to understand the importance of values and how they may differ among family members. Clear company values can help to bridge the generational gap and give the next generation that sense of purpose they crave—but documenting family values isn’t a widespread activity for family businesses at present, although it should be. While 73% of Canadian families (78% in North America) say they have a clear set of family values, only 44% (53% in North America) have documented their family values and the mission for their company. 

By working with family members to identify and document family values, business purpose and desired family legacy, founders and business leaders can better make sure their business reflects what matters most to those who will need to lead the business forward. Family businesses with values in a written form are also better prepared for succession and are more communicative and transparent.

Agreement on family values (% agreement with the statement)


Family that owns business has clear values
%
Family has clear sense of agreed values and purpose as a company
%
Family's values define clear expectations for family members
%
Family has a documented vision and purpose statement for the company
%
Family has values and purpose articles in written form
%
Family has a defined code of conduct
%

 

 

*About the Family Business Survey: The Family Business Survey is a global market survey of 2,801 owners and executives between October 5 and December 11, 2020, including 205 in North America and 65 in Canada.

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Sabrina Fitzgerald

Sabrina Fitzgerald

National Private Leader and National Capital Region Leader, PwC Canada

Tel: +1 613 898 2113

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