CSR a key element for success at top family businesses
03 April 2017
Category: News, Asia, Global, USA, Europe
By Asia Asset Management
Fast-growing, mid-sized family businesses around the world have identified corporate social responsibility (CSR) as an important element for their success, according to a joint report by Citi Private Bank and UK-based family business information provider Campden Wealth Research.
The report, entitled The Top 50 Global Challengers, released last week (March 30), profiles 50 fast-growing family businesses with turnover between US$200 million and $6 billion globally, based on their average annual growth between 2015 and 2016.
Geographically, 62% are from Europe or North America, 16% each from the Asia Pacific region and Latin America, and the balance from the Middle East and Africa.
According to the report, CSR policies are very much in evidence among these businesses, with a high incidence of reporting the impact, and having procedures for CSR policies within the areas of social (86%), environmental (82%), and employee involvement (74%). It says these businesses consider CSR as a way to engage the next generation of family members.
According to Philip Watson, head of global investment lab at Citi Private Bank, strong CSR can help build the reputation of companies, as well as their controlling families and key stakeholders. “Doing good for society and the environment, and philanthropy helps consumers associate and build loyalty with brands,” he says in the report.
It also highlights the fact that top businesses have embraced globalisation in order to grow, with 43 of the 50 companies operating within a sector that has a reach spanning 3.7 regions on average.
Overall, these businesses operate in 14 sectors but are predominantly active in the secondary economy, with nearly half in retail, consumer goods and lifestyle (24%), and agriculture, food and beverage (24%). This is an indication that the mass production of consumer goods that are distributed internationally has driven the successful expansion of many of these companies, according to the report.
Mr. Watson notes that these sectors have benefited from significant population growth, urbanisation, mass-market production, and a focus on meeting consumer demand. “With the advantage of requiring relatively low capital investment in early stages, families and their businesses have developed strong and often highly competitive ecosystems within their sectors,” he says.