EY: a fraction of Hungarian family businesses have a formal succession plan
Only 14 percent of Hungarian family businesses have an official succession plan, while the question of changing ownership only arises informally for a third of those surveyed, and the same number do not deal with this topic at all – according to EY’s second Entrepreneur Barometer research.
In their statement sent to MTI on Tuesday, it was explained: In Hungary, in the past year, the proportion of those who do not want to part with the management of the business has decreased from 43 percent to 27 percent. 30 percent of the respondents consider a change of ownership realistic only after ten years, and only 20 percent would withdraw in the next four years.
43 percent of Hungarian entrepreneurs would sell their company within the family, 41 percent to another company, 10 percent to a financial investor, and only a tiny fraction of them are thinking about going public.
These data position Hungary among the control-oriented markets, as opposed to the region where there is greater openness to financial exit solutions – they said, adding that this restrains transaction activity and also economic growth.
Csaba Horváth, partner of EY-Parthenon, emphasized: the earlier the preparation for the change of ownership begins, the more opportunities remain in the hands of the current owners to shape the future of their company according to their own terms.
Coordinating family and business interests is one of the biggest challenges for Hungarian businesses. According to almost a third of the respondents, conflicts within the family significantly influence the operation of the business, while every fourth respondent is concerned about preserving the family’s reputation.
More than a thousand entrepreneurs from 16 Central-Eastern and Southern European countries participated in the online research conducted in February and March, 173 in Hungary.
Source: trademagazin.hu
