Kirsty Ross

In recent years, the impact and the make-up of family businesses has transformed.

At KPMG, we’ve carried out a number of exploratory studies into what lies behind the changes, and we’ve discovered an unexpected trend. Family businesses have become accidental trailblazers, leading the way in female business empowerment.

In the decade between 1997 and 2007, there was a fivefold increase in the number of women leaders in family-owned businesses. The pace of change has been dramatic, and it’s transforming the image and make-up of companies throughout the country.

While great progress has been made, there’s widespread recognition that we have a long way to go. From the gender pay gap, to subconscious bias in recruitment, there are still a variety of challenges facing women with career aspirations. Family-owned businesses could offer some answers, and justifiably so. The latest research from the Family Business Sector Report, published by the IFB in May, revealed that around 81% of family SMEs were likely to have female leaders, compared to just 58% of non-family SMEs.

We shouldn’t be entirely surprised that such companies are now leading the field in tackling today’s societal issues. Businesses that have survived for hundreds of years, through generations of family members, and different economic climates, have demonstrated a resilience and a sense of innovation. To understand what’s driven the change in this group, we have to look back at the challenges that were overcome. Thirty years ago, much of the research on attitudes and work practices highlighted that family businesses faced largely the same issues as any other company. In some ways, engrained culture and dynamics were a greater challenge for women tasked with running a family home. From birth to death, females were often underappreciated and often shunted to the side, but a slow, determined change began to take shape in recent years, with numerous studies revealing that women were learning to circumvent sexism by refusing to stay out of the spotlight, and ensuring their voices were heard and their ambitions appreciated. They have always had an important role to play, but in the past has been more invisible to the outside world. This is definitely changing!

As social attitudes have changed, so too has the economy. We’ve become a far more globalised nation, looking outwards for growth. That’s created an international marketplace with businesses routinely growing through acquisition and greater collaboration. But, this has created a new threat for family-owned businesses, determined to maintain their independence. An increasingly disruptive, rapidly changing economy has forced companies of all shapes and sizes, and in all sectors, to play to their strengths. In the case of family businesses, women were often viewed as ‘Chief Emotional Officer’, responsible for keeping the family structure intact, rather than the family business. But, in a dramatically shifting economic environment, ensuring every member takes an active, positive role has become more important than ever before. At the same time, away from the workplace, social norms and demographics have evolved. Many women are now choosing to have children later in life, and many households are sharing responsibilities for childcare and family development.

The traditional image of a family business is one with a small group of leaders, and a loose band of employees, but the reality is that this network of companies is driving much of the UK’s economic success. In my role, I’ve witnessed businesses looking at succession planning and trying to understand how best to pass a profitable, successful operation over to the next generation. This has become the driver for much of the change we’re seeing. There’s an increasing recognition that the ‘father-to-son’ transition is unsustainable and outdated. Increasingly, siblings are working together as they take the reins, agreeing on more collaborative strategies, and ensuring that roles are assigned to skillset, rather than being based on gender assumptions.

As we enter an increasingly challenging period of time, with growing economic and political uncertainty, family businesses must focus on their strengths, and ensure they have the right plans in place to empower and embrace the talent within, regardless of gender. There are clear signs many companies within this category are already acting on that advice. It’s time for the wider business community to follow suit.

• Kirsty Ross is a family business consultant at KPMG in Scotland