- When the pandemic broke out, Spanish family businesses had enough liquidity to meet payroll and expenses for nearly nine months.
- 92% of Spanish Family Businesses have made it a priority for employees to have the information and knowledge they needed to deal with the situation caused by COVID-19, compared to 65% of non-family businesses.
- In such a complex and uncertain context, Spanish family businesses had two priorities: the health of professionals and keeping the business running, 52% of respondents implemented teleworking solutions.
- 12% of Spanish Family Businesses reacted quickly by adapting their product to the remote environment, the health emergency and the needs of the market, a result that equals the percentage at a global level, 13%.
These are some of the conclusions derived from the study on the agility, adaptability and resilience of family businesses in the face of the economic and social consequences caused by the global PANDEMIC of COVID-19, by the teams of researchers in Spain that belong to the international consortium STEP Project (Successful Transgenerational Entrepreneurship Practices) (https://thestepproject.org/) in collaboration with KPMG.
STEP Project is an international consortium founded in 2005, and currently involves 22 research groups from all continents. This research network collaborates with other universities and this allows it to analyze the characteristics and behaviors of family businesses in more than 70 countries. In Spain, this project includes the Chair of Family Business of the Universitat de València promoted by the Valencian Association of Entrepreneurs (AVE), the School of Entrepreneurs (EDEM), the Valencian Institute for the Study of Family Business (IVEFA), the Institute of Family Business (IEF), the University of Valencia (UV), and sponsored by Broseta and CaixaBank; The Chair of Family Business of the University of Jaén, and researchers from the Department of Business Management and Sociology of the University of Extremadura, who have had the collaboration of the Chair of Family Business and Business Creation of the Abat Oliba CEU University in the field work to obtain answers from Spanish family businesses.
The study analyzes a total of 469 responses, of which 415 are from family companies, and identifies four different profiles whose characteristics are associated with who exercises the leadership of the company and the composition of the shareholding: family venture, family corporation, family consorium and family enterprise.
The report presents the main results of the study carried out on the response of family businesses in the months following the declaration of the state of alarm. These results show that the commitment and agility of Spanish family businesses are the two most important elements of their response.
Spanish family businesses demonstrated great agility in the immediate response, implementing control actions and cost reduction, but maintaining a strong commitment to employment. Labour costs were controlled through reductions in working hours, admission to state aid programmes, adjustments in executive pay and intensive communication with employees.
The report shows three alternatives of strategic response: Social responsibility, 3 of the 4 types of companies identified follow this strategy, because this type of companies is closely linked to the communities to which they belong, the prestige of the family is determined by responsibility and empathy with society; business transformation, the great agility to transform in a time of uncertainty, to be able to adapt to the situation, to seek and take advantage of opportunities in such a complex and uncertain context; and caution, opting for this strategy has shown a special concern for the retention of talent and the well-being of employees.
The economic and social consequences caused by the COVID-19 pandemic are a very complex challenge for Family Businesses. Throughout these months, Spanish family businesses have not only focused on maintaining the business, but also on taking care of the different stakeholders, reinforcing their protection, promoting teleworking, adopting measures aimed at guaranteeing the financial tranquility of employees and guaranteeing service to society. The close link with the environment has been evident during the health emergency, most put a lot of emphasis on orienting their activities and putting their resources at the service of society, adapting to changes in the environment and being able to see the situation as an opportunity for transformation have become a strength of companies.
The report also has testimonies from entrepreneurs from the different territories of Spain, through which they publicize their actions during the pandemic and which further strengthen the role of entrepreneurs and companies in society.
