Family businesses in Bangladesh brave pandemic

PwC report reveals

Staff Correspondent

18 February, 2021 12:00 AM printer

Most of the country’s family businesses have enjoyed positive growth in the immediate-past fiscal year despite the pandemic, according to a study by Price Waterhouse and Coopers (PwC).

The report said 52 percent of the country’s family businesses experienced growth while only 17 percent witnessed sales reduction.

A family-owned business may be defined as any business in which two or more family members are involved and the majority of ownership or control lies within a family.

The report mentioned that the Bangladesh situation is similar to the global picture where 55 percent family businesses grew while 19 percent witnessed fall.

Around 31 percent of Bangladesh family businesses reported fall in sales during the pandemic, smaller than the global average of 46 percent.

Regarding the growths, the Bangladeshi entrepreneurs are ambitious for 2022 comparing global situation but remain a bit cautious about 2021.

“Some 74 percent of Bangladesh family businesses expect to see growth in 2021 which is better than global figure of 65 percent. And 93 percent expect to see growth in 2022 (compared with 86 pc globally),” the report added.

Some issues may play role in better performance of Bangladesh family business. For example, the report mentioned, the country’s family businesses are positive about the clarity of roles and strength of leadership within the business. In addition, most of family business feel that they embrace rather than resist change.

However, only 39 percent feel they have strong digital capabilities. This is similar to the global average where 38 pc feel strong digital capabilities. But only half say there is family alignment on company direction and levels of communication and transparency could be improved.

Over 60 percent of Bangladesh family business feel they have a clear sense of company or family values and these values have helped a clear majority during the corona virus pandemic.

Some 33 percent of Bangladesh family business claim to have a robust, documented and communicated succession plan in place, compared with 30 percent globally.

Over 90 percent of Bangladesh family businesses engage in some form of social responsibility activities. In fact, this tends to involve contribution to the local community or traditional forms of    

philanthropy. Around 44 percent of the country’s family business feel a responsibility to fight climate change and its related consequences. The same proportion  ensures sustainability is at the heart of everything they do compared to 49 percent globally.

Only 37 percent of family businesses in Bangladesh have a developed and communicated sustainability strategy.

The report said the future intentions here are more encouraging though with 67 percent of family businesses saying there is an opportunity for family businesses like theirs to lead the way in sustainable business practices. It is much better than 55 percent of global data.