Author: Abbie-Louise

Senior business leaders back the launch of the Family Business UK Manifesto

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The Family Business UK Manifesto – Taking the Long-Term View which lists “policies to unleash the potential of the UK family business sector” has received support from business leaders from Rigby Group, Samworth Brothers, Wates Group and ARCO, amongst others.

Published today, the Manifesto sets out a list of key policy recommendations that can provide “enormous potential of the family business sector to support economic growth, family businesses, their workforce, and society at large.”

Read The Family Business UK Manifesto 2024

Family Business UK believes that for too long, political, industry and business decision-making has taken a restricted approach to investment decisions that responds to the priorities of non-family business PLCs, whose priority is to meet shareholder demands for short-term returns on investments.

The UK needs to formulate a growth strategy that encourages and incentivises businesses to focus on longer-term investment opportunities and returns for stakeholders, the environment, and the UK’s role and place in the wider world.

People: Policymakers and business must come together to help family firms to get the best out of their people through investing in skills and opportunities for local communities by:

  • Replacing the Apprenticeship Levy with a Future Skills Fund
  • Allowing more flexibility on how businesses use the fund for skills
  • Removing barriers on spending between home nations
  • Encouraging upskilling and career long learning

Growth: Family firms – backed by a clear government agenda – can help to deliver growth, enabling them to invest for the long term to create sustainable businesses and jobs by:

  • Developing a Long-term Industrial Strategy, and to publish a Business Tax Roadmap
  • Making the new Full Expensing rules for capital investment permanent.
  • Reviewing the disparity in the tax treatment of debt and equity financing
  • Developing a stand-alone growth and support strategy for mid-sized businesses,
  • Raising the eligibility threshold for EIS to 499 employees (the same level as for knowledge-intensive companies) and increase the investment limit.

Ownership and succession: Promoting family ownership and ensuring a smooth transition from one generation to the next also building new companies for the future by:

  • Committing to maintain Business Property Relief (BPR) in full
  • Updating the rules for BPR to support businesses with joint ventures
  • Bringing Gift Holdover Relief (GHR) eligibility into alignment with BPR to enable a smooth transition in ownership between generations

Sir James Wates CBE, Chair of Family Business UK:

“Family businesses are the backbone of the UK’s entrepreneurial landscape, weaving together tradition and innovation.”

“Their unwavering commitment to quality, sustainability, and community sets them apart.”

“I wholeheartedly endorse the manifesto for family businesses in the UK, recognizing their vital role in driving economic growth and nurturing the local fabric of our society.”

Chief Executive of Family Business UK, Neil Davy, said:

“In the UK, we are sitting on an enormous resource of entrepreneurialism in the form of our family business sector.

“This manifesto represents our offer to policymakers, informed by the UK’s family business community and their everyday experience of doing business in helping to solve the big challenges of today and tomorrow.

“If implemented, they will unleash the enormous potential of the family business sector to support economic growth through responsible business practices that benefit the family business, their workforce, and society at large.”

Read The Family Business UK Manifesto 2024

New Research Reveals How Much Family Firms Contribute in Tax

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Family businesses generated more than a quarter of the UK tax bill in 2021, new research can reveal.

The research published today by the Family Business Research Foundation and PwC UK reveals how much the UK’s family businesses are contributing in tax receipts.

This is the first report of its kind, exploring in depth the tax contribution of family firms and analysing the breakdown of all taxes contributed.

In 2021, the family business sector as a whole is estimated to have contributed £225 billion to UK public finances. This represents 27% of government receipts from all taxes in the UK. Out of this £225bn, £74bn was contributed in taxes borne- those that are a direct cost to the company – and £151bn in taxes collected, such as income tax and employee National Insurance Contributions (NICs).

For every £100 of turnover, family businesses in the study contributed an average of £18.50 in taxes.

As part of the research, the tax contributions of 44 firms were analysed. The research found that the largest proportion of taxes generated were people taxes (43%). Products taxes were next highest (37%), followed by profit taxes (12%), property taxes (6%) and planet taxes (2%).

The greatest contribution to the Exchequer from study participants is through employment taxes, 43% of the Total Tax Contribution. Corporation tax accounted for 10% of the tax contributed by study participants.

In the UK, family firms employ around 14 million people. For every Person employed by the companies that took part in the study, £11,468 was generated in employment taxes. The largest element of value distributed by family firms in the study was to employees in wages (41%), followed by amounts generated in taxes (34%) showing the valuable contribution made by family firms through employment and to the Exchequer.

Sir Michael Bibby, Chairman, Family Business Research Foundation, said:

“We are pleased to be able to share this new study, which marks a step forward in producing more robust evidence on the overall economic impact of the UK’s family businesses. This report presents new evidence on the contribution that the family business sector makes to the UK’s public finances –to the tune of £225bn in 2021. “

“For the first time, through this research, we can see a full breakdown of the taxes being generated by family firms. This not only highlights their enormous contribution but will also help policymakers model the impact of any changes they propose in the future for the family business sector. “

“Employment in family firms and the generation of employment taxes are important ways they contribute to the economy – as our previous research shows, family firms employ around 14 million people in the UK. It is also interesting to note the comparatively higher value distributed to employees by family firms.”

Andy Wiggins, Partner, and Total Tax Contribution Leader, PwC UK, said:

“This is the first time we’ve prepared a Total Tax Contribution report for the Family Business sector.”

“Alongside the incredible impact family businesses have on the public finances, one of the key messages coming out of the report is the importance of investing in employees. Family Businesses are taking advantage of the apprenticeship levy, which demonstrates the importance family leaders put on developing careers and supporting local communities.”

Fiona Graham, Director of External Affairs and Policy, Family Business UK, said:

“Family businesses are the backbone of the UK economy and the bedrock of our communities. While we can see the positive impact, they have in communities up and down the country, this is the first time we have had a detailed breakdown of the contribution made to our public finances. “

“We are pleased to see this report published today to further build on the evidence of the important economic contribution family firms make to our country. And we hope that politicians and policymakers will study the report, and ensure they consider the cumulative impact of policy changes rather than looking at each tax policy in isolation.”

View the report on the Family Business Research Foundation here.

FBUK Response to reports Labour intend to scrap Inheritance Tax Business Relief

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Responding to reports Labour intend to scrap Inheritance Tax Business Relief, Neil Davy, CEO of Family Business UK, said: “Such a move would quite simply have a catastrophic impact on the family business sector, which employs 14 million people in the UK”.

“Business Property Relief (BPR) – now known as Business Relief – was specifically designed to facilitate the handing of a family business from one generation to the next without creating a significant Inheritance Tax (IHT) charge which the business would be unable to pay.  It is well designed and understood by business owners and gives them the confidence to invest and plan for their businesses to continue trading and providing employment after their death”.

“For business owning family members, the illiquid business assets form the bulk of their estate. Without BPR, the IHT liability would be borne by the business itself. This would require the family business to be sold, liquidated or broken up in order to raise the necessary cash to pay the charge. This would have clear knock-on effects on levels of employment in communities across the country, and the ability of the business to invest for the future”.

“85,000 family SMEs are expected to transfer ownership of their business to a new generation each year. BPR affords these firms an option to plan for a stable succession while maintaining ownership stability. It also plays a key role in ensuring that these small and medium firms can focus on scaling up their businesses. Around 77% of family SMEs are estimated to be first generation businesses”.

“Without BPR these family firms would lose the opportunity to grow under stable ownership and successfully transition to the next generation”.

“We agree that all reliefs must deliver for the taxpayer. Business Relief is a perfect example of a relief that achieves exactly what it was designed to: enabling family business to plan for the long term and ensure jobs and prosperity are protected from one generation to the next.”

END.

PM’s Business Council Must Represent All Businesses

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Family Business UK, along with four other business organisations, has called on the Prime Minister to expand his new Business Council to ensure it better represents the UK business community.

In a joint letter Family Business UK, the Federation of Small Businesses, IPSE, Small Business Britain and the Employee Ownership Association said the new Business Council excludes 99 per cent of businesses in the UK, and risks the Prime Minister not receiving the full picture of the challenges facing businesses.

The full letter reads:

Dear Prime Minister,

Business Council: Representing the UK Business Community

We are writing to you on behalf of the millions of small and mid-sized businesses, self-employed people, family businesses and employee-owned organisations across the UK. These businesses make up the vast majority of UK businesses, and provide employment for millions of people.

We were pleased to hear that a new Business Council had been established. This provides an important opportunity for you to hear directly from businesses about the challenges they face on the frontline, as well as potential opportunities for investment and government support.

However, as it stands, the new Business Council excludes 99 per cent of the UK business sector; the sole traders, small and medium-sized businesses, family businesses and employee-owned firms who collectively employ well over half the UK workforce, and who are at the forefront of innovation, employment and wealth creation that the UK relies on for economic growth and prosperity. The businesses we represent are not only an important part of our economy today, but many are leading the way in areas like AI, the future of work and Net Zero. They have an important role in the economy of the future.

The challenges these businesses face in all our local communities are often very different to those faced by large, listed companies such as those so far represented on the Business Council. The challenges facing a Chief Executive of a large corporate, and their priorities, are often worlds away from smaller private businesses.

The interventions you make on behalf of those large corporates won’t necessarily work for smaller firms. With the full diversity of size and models amongst UK business not being represented on the Business Council, the issues facing the majority of businesses may be overlooked. Given the contribution of these businesses to the health, wealth, and long-term growth potential of the UK economy, this would be a significant risk to the aim of designing and driving the future of the British economy. There is also a clear risk on some issues where the business community strongly differs, which could mean you are briefed on it from a small group of like-minded individuals, overlooking the other side of the argument.

Each model of business ownership also faces unique challenges. Each requires specific support to help grow and attract investors into the UK. The needs of these different businesses can only be addressed if they have the chance to engage with government at the highest level.

As Prime Minister, we think it’s crucial that you hear what’s really happening at the frontline of business, and the practical new ideas we have for economic growth. We would ask therefore to either expand those attending your two Business Council meetings per year to include the diversity of UK business, or that you consider meeting with our organisations, together, in addition to it. We would discuss what we can bring to the table, to ensure all our businesses flourish.

Like you, we want the UK to have a thriving economy and a supportive regulatory and tax environment that enables businesses, communities and families prosper for generations to come.

We urge you not to miss the opportunity to make that a reality by ensuring the voice of SMEs, family businesses, the self-employed and employee-owned organisations is properly represented and heard through the Business Council or alongside it in a new, more diverse, business collective.

Yours sincerely,

Neil Davy, Chief Executive Officer, Family Business UK
Tina McKenzie, MBE, National Policy Chair, Federation of Small Businesses
Derek Cribb, Chief Executive Officer, IPSE
Michelle Ovens CBE, Founder, Small Business Britain
James de le Vingne, Chief Executive Officer, Employee Ownership Association

 

Read more about this in The Times: https://www.thetimes.co.uk/article/put-us-on-business-council-say-small-firms-k92lvkh8m

Steve Rigby, Co-CEO Rigby Group joins Family Business UK Board

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Steve Rigby, Co-CEO Rigby Group joins Family Business UK Board

We are delighted to announce the appointment of prominent Midlands and UK Family business leader Steve Rigby of Rigby Group plc to the Board of Family Business UK.

Steve is responsible for leading strategy, finance & investments for the family in both the private and public markets, and has over 30 years’ experience contributing to the growth of the Rigby Group.

A UK Top ten wholly-owned family business, and one of the largest in the world, Rigby Group is rooted in the Midlands.

Since its inception in 1975, by Sir Peter Rigby, the Group has built a distinguished reputation as both an investor and business operator with a strong technology focus.

Today it is a multinational, service-based holding company for a portfolio of privately-owned businesses, employing over 8,500 employees across 8 countries.

Steve Rigby said:
“I am delighted to have joined the board of Family Business UK, which represents over 200 of the UK’s leading family businesses, ensuring their voice is heard when shaping policy and also that they are supported on their journey through the generations”.

“Rigby Group is proud to be a top 10 UK wholly-owned family company and in the world’s largest 500. We are strong supporters of the private sector economy, and the opportunities that come with it, thanks to its long-term outlook, regional diversification and short lines of decision making”.

“I hope to bring my passion for the sector, together with a deep knowledge of tax policy, to help ensure this critical sector of our economy flourishes and performs as an economic powerhouse for the nation.”

Other Board positions

Steve also sits on the boards of SCC, Rigby Technology Investments, Regional & City Airports, Rigby Real Estate, the Group’s hotel division, Nuvias Unified Communications, CloudClevr, Infinigate and Rigby Group.

The Family Business UK team welcomes Steve onto the board, and looks forward to benefitting from his considerable expertise and experience.

Family Business Week 2023 to Focus on “Future Leaders”

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Following two successful campaigns in 2021 and 2022, we are delighted to share that Family Business Week will return in 2023.

This year, from the 20th to the 24th November, we will celebrate ‘Future Leaders’.  And we are calling on family businesses to help us champion the next generation of leaders.

Running for the first time, this year we will be recognising and championing the work of the next generation of family business leaders by showcasing individuals in a ‘Ones to Watch’ future leaders list.

Nominations are now open.

Those showcased individuals will be recognised as leading the way in areas such as product innovation, sustainability and ESG, social impact, diversity and inclusion, circular economy, good governance, or other aspects of being a leading sustainable and responsible business.

Whether family members or not, we want to showcase those young people who embody the spirit of innovation, sustainable growth and strong values that make family firms so special.

These inspiring individuals will be profiled during Family Business Week, where we will celebrate their contribution, and share insights from their journey to inspire and support other Future Leaders.

Why nominate?

  • Celebrate the incredible work of a young person in your business, and show your appreciation.
  • Raise their profile, and your company’s.
  • Inspire the next generation of family business leaders.

How To Nominate

It couldn’t be easier to nominate someone from your business. First check the criteria and make sure the person qualifies.

Then send us a email with the subject ‘Ones to Watch Nomination’ to info@familybusinessuk.org

In your email include:

  • Your name.
  • Name of nominee and their role in the business.
  • No more than 750 words on why you are nominating them.

Criteria: To qualify for the list, nominees must:

  • Be under 40-years old.
  • Work in a family business.
  • Be making a difference in your business.

We will then review and shortlist the nominees, and if the person you have nominated is successful, we will get back in touch with you, so you can share the exciting news!

They don’t:-

  • Have to be a family member.
  • Have to work in your family business, as long as they work in a family business.
  • Have to work at a Family Business UK member company.

Our judging panel will be considering a number of criteria when reviewing nominations, including:

Taking the long term view: How is this person ensuring that they take a long term view to running their business?

Putting people first: How is this person ensuring that their business puts people at the heart of everything they do?

Taking a purpose-led approach: How is this person putting purpose at the heart of their business?

Innovating, investing and taking risks: What is this person doing to take a creative and innovative approach to their business?

Investing in local communities: What is this person doing to invest in their local community and act as a force for good in society?

We look forward to receiving your nomination, and celebrating Family Business Week 2023 with you.

Family businesses have a leading role in shaping a successful future for the UK

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Neil Davy, Chief Executive of Family Business UK

Over the past few years, we’ve seen extraordinary political change. In my brief time as Chief Executive of the Institute for Family Business, the UK has witnessed four Chancellors, three Prime Ministers, and two Monarchs.

This unprecedented amount of disruption and uncertainty has continued across the business sector thanks to geopolitical instability, a cost-of-living crisis affecting all parts of our economy, as well interest rates and inflation levels not seen for years.

Most recently, low levels of trust in our big institutions, including business bodies, have been rocked even further and left businesses of all sizes wondering where to look for some certainty, a voice, and a hopeful vision for the future.

Even with the Prime Minister’s five pledges set out earlier this year – which include halving inflation–Britain risks merely moving from a position of atrophying to stagnation, or at best low growth.

A strategy for growth

The UK needs to formulate a growth strategy that encourages and incentivises businesses to focus on longer-term investment opportunities and returns for stakeholders, the environment, and the UK’s role and place in the wider world.

Similarly, if the events of the past few months have taught us anything, it’s that the business community and the groups that represent British industry need to work much harder for the businesses they represent if they, and the UK, is to have a prosperous future.

We need to champion the interests of business, but also provide support in helping them grow, and highlight their role and contribution economically, as well as in every aspect of society.  This starts by properly acknowledging, representing and listening to the views of family businesses which operate in every sector and community in the UK.

The opportunity

That’s why, today, we are proud to unveil Family Business UK: a new movement of family businesses advocating for the family business model as a leading example of sustainable and responsible business that should have a stronger role in shaping Government policy and within the UK economy.

For too long, political, industry and business decision-making has taken a restricted approach to investment decisions that responds to the priorities of non-family business PLCs, whose priority is to meet the demands of anonymous shareholders looking for short-term returns on investments.

​There is now an opportunity – and a need – for the voice and model of family business to take centre stage.  Family businesses offer a model that others can learn from, work with, work for, or even adopt.

Family businesses represent the bedrock of our communities, the backbone of our economy and are people-centric organisations.

Our latest research, in conjunction with Censuswide, reveals the majority of the British public would prefer to work for a family business over other business models such as Private Equity, PLCs, and Venture Capital Firms.

Those polled also said they would rather buy from a family business than from any other type of business. They are so much more than short-term wealth creators, but forward-thinking innovators, skill providers, community builders and multigenerational institutions embedded into the history and fabric of British society.

In 2020, family businesses across the whole of the UK generated £575 billion in gross value added (GVA) contribution to GDP (gross domestic product) and employed 13.9 million people.

A positive step forward

It’s time to show the positive impact family businesses have on our society, the economy, and the environment. And it’s time for Government to advocate and support the sector if we want to address and solve the biggest challenges in society and create a more prosperous future for all.

Family Business UK is a growing movement that will champion the model of the family business. They present a leading model of sustainable and responsible businesses that puts the interests of all stakeholders, not only shareholders, first.  I don’t believe they have been properly acknowledged, represented or championed.

Our aim is to support family businesses and the sector to grow and prosper for generations to come; advocate for policies and regulation that incentivise long-term investment and ensure the financial sustainability of the sector; and shift perceptions towards family businesses, and the contribution they make to society.

Family businesses are vital to the long-term strength and prosperity of the UK, and our economy and our communities. For too long their value and contribution has been under-represented and overshadowed. It’s time for that imbalance to be addressed.

 

‘A new vision for the UK Economy’: IFB relaunches as Family Business UK to strengthen ecosystem of support for family businesses across Britain

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  • Family Business UK is a growing movement of family firms seeking to advocate for a stronger role and voice of family businesses whilst providing support to the sector at all levels.
  • The organisation will promote the role of the family business model as a leading example of sustainable and responsible business, working to shift the perceptions and better significant role they play in our economy and communities up and down the country.
  • Launch comes as exclusive polling from Family Business UK and Censuswide found that almost half of British consumers would prefer to buy from a family business.
  • Study also reveals a quarter of the British Public feel the UK Government should do more to promote the family business model within policymaking. Nearly a third (28%) said more support should be given to family businesses.

 

Monday 3 July: After two decades operating as the ‘Institute for Family Business’, today the organisation is delighted to announce it will be relaunching as Family Business UK.

Family Business UK’s new purpose will focus on creating a movement of family businesses that promote the role of the family business model as a leading example of sustainable and responsible business.

The organisation will work to improve the perceptions of family businesses, and better highlight the contribution and significant role they play in our economy and communities up and down the country.

Family Business UK will also support and advise family businesses to invest, grow and sustain for the long-term, helping family businesses of all sizes deal with common challenges across various stages of the business lifecycle.

Sir James Wates CBE, Chairman of Family Business UK, said:

“Our objective is to lead a movement of family businesses working to create a more prosperous and sustainable future for generations to come, positioning family businesses in the UK as an economic force that demands the respect of government and policy makers. We invite all family businesses to join us.”

Kevin Hollinrake MP, Minister for Enterprise, Markets and Small Business said:

“Family businesses play a vital role in the UK economy and are valuable and trusted components of our communities. As a sector that delivers jobs and training to local regions, they employ 13.9 million people across the UK and represent the best of British business.

“I look forward to continued engagement with Family Business UK to ensure that family-owned firms are championed, and can operate in an environment where all enterprises can flourish and grow.”

 Chief Executive Neil Davy said:

“Responsible businesses, like family businesses, need a vocal champion that showcases their strengths, supports them with their challenges and celebrates the role they play in society. As Family Business UK, we are committed to ensure their work and contribution is recognised and supported.”

The announcement comes as exclusive research commissioned by the Family Business UK and produced by Censuswide* reveals that 35% of the British Public would prefer to work for a family business over other business models such as Private Equity (11.4%), PLCs (13%) and Venture Capital Firms (8%). Those polled also said they would rather buy from a family business (44%) than from any other type of business.

Regional Breakdown

The regions where consumers said they would want to buy from a family business

Region Preferability
Scotland 51%
South West 48%
South East 47%
Yorkshire and Humber 46%
North East 44.1%
West Midlands 44%
North West 42%
East Midlands 42%
East of England 40%
Wales 39%
London 38%

 

Chief Executive Neil Davy said the re-branding to Family Business UK will better reflect the organisation’s focus and goals whilst championing the interests of its members, provide additional support and highlight the wider role of family firms in society.

Family Business UK believes that for too long, political, industry and business decision-making has taken a restricted approach to investment decisions that responds to the priorities of non-family business PLCs, whose priority is to meet shareholder demands for short-term returns on investments.

Family businesses offer a model of business that put people at the centre of decision making, see values as an asset, have greater freedom to experiment and innovate and, ultimately, takes a long-term view, putting the interests of the next generation at the heart of businesses.

The UK needs to formulate a growth strategy that encourages and incentivises businesses to focus on longer-term investment opportunities and returns for stakeholders, the environment, and the UK’s role and place in the wider world.

This starts by properly acknowledging, representing and listening to the views of family businesses which operate in every sector and community in the UK.

Censuswide research also reveals that the British Public believe family businesses have the best business model for putting people at the heart of business (24%) when compared to other models.

Family Businesses also take the most local approach and are seen as the leading model for companies prioritising investment in their local communities, according to the study.

Overall, a quarter of the public felt that the UK Government should do more to raise awareness and promote the family business model within policymaking, with nearly a third (28%) of those polled saying more support should be given to family businesses. This included cutting Business Rates (27%), introducing new policies that help owners pass their business to the next generation, and also appointing a Family Business Minister in Government.

In 2020, family businesses across the whole of the UK generated £575 billion in gross value added (GVA) contribution to GDP (gross domestic product), and employed 13.9 million people.

This means that family firms comprised 85.9% of all UK firms, directly generated 44.4% of GDP, and were responsible for 51% of all private sector employment in the UK economy in 2020.