“We are witnessing a shift in demographics: ownership of family businesses is shifting to a younger generation of leaders as the pandemic increasingly relies on digital technologies,” said Yannick Archambault, national head of KPMG’s Family Management Office in Canada. Technology is radically changing the way companies do business, and today’s leaders are increasingly turning to the next generation to get things done. »

The vast majority of current owners, seven in ten, believe that a new generation of leaders will be better able to lead their company to success.

“Increasing recessionary pressures could further accelerate the pace of this transition as family businesses adjust to new economic realities,” continues Yannick Archambault. Many new leaders adopt a growth mentality. They usually have a deeper knowledge of new technologies and innovations and are willing to integrate social and environmental factors into business planning to make their company more resilient and sustainable. »

However, due to a lack of succession plans or interest from the next generation, 26% of respondents think they should sell their business within the next three years. In particular, this sale could help owners fund their retirement plans while freeing their families from the business.

OPPORTUNITIES FOR GROWTH

Despite the economic slowdown, many entrepreneurs see growth opportunities. Because of this, 71% plan to raise capital, 59% plan to acquire a new business within the next three years, and 64% plan to expand operations outside of Canada.

“Family businesses with strong balance sheets, capital, or access to capital might consider acquisitions at lower prices or make the necessary investments to support internal growth and investments,” said Dino Infanti, National Leader of KPMG Enterprise Tax, KPMG in Canada. This can mean exciting new opportunities for family businesses to leverage their existing and emerging strengths to promote diversity, create wealth and create jobs. »

ESG, REMEMBER

KPMG’s survey shows that environmental, social and governance (ESG) factors are now at the forefront. In fact, 70% of family businesses say they have an ESG strategy in place, and 69% believe these programs are having a positive impact on their financial results.

The new generation is no stranger to this fact, with 66% of respondents saying their desire to increase their ESG engagement comes from the next generation.

KPMG’s survey was conducted August 16-1 through Schelsinger Group’s online platform Methodify among business owners and senior management decision-makers at 503 Canadian SMBs^ah September.