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Family business in the Netherlands

Albert Jan Thomassen is director of the Family Business Centre at Tias Business School and director of FBNed, the Dutch Association of Family Firms.

A large number of Dutch family firms created in times of economic development now face succession issues, instigating a wave of research and education activities to help and support these firms

"The 21st century is the Family Business Century", said Peter Swinkels, 7th generation CEO of the Dutch Beer Brewery Bavaria and founding president of the Dutch Association of Family Firms (FBNed) some years ago. The value of this statement can only be judged in another hundred years, but a lot is happening around family business in the Netherlands. An overview of recent developments in the most predominant form of enterprise in the Netherlands follows.

As in many other countries, owner-­managed and family businesses account for about 80% of the total number of companies in the Netherlands. However,  around 55% of the companies are largely controlled by a family through ownership and management. These firms account for almost half of the employment in the private sector and between 45 and 54% of the Dutch gross national product (GNP).

As far as is known, the oldest, still existing, family firms started in the 17th century. Bell maker Petit & Fritsen was founded in 1660 and Van Eeghen International, the oldest trading company in the country, traces its roots to 1662. Examples of large Dutch family firms and international players are C&A (Brenninkmeijer family), Heineken, Blokker, SHV (Fentener van Vlissingen family. But there are also less known family firms who are the top global players in their respective fields, like the offshore shipping and dredging company Van Oord ACZ, seed developer De Ruiters Seeds and Burgers Zoo.

The baby boom effect
One of the main reasons family businesses attract a lot of attention is that the baby boom generation is now retiring. Many family companies started just after World War II and in the sixties and seventies, following not only the growth of the population but also economic development in the Netherlands. Founders are now retiring and are able to retire sooner than in previous years. As a result, in the coming years about 90,000 firms will face succession issues in the Netherlands. This succession wave has led banks and accounting firms to develop services and support research and expertise centres for family firms. Leading firms in this respect are BDO Accountants & Advisors and ING Bank. Employers and industrial organisations also provide special services to their member companies as in the printing industry, transport and metal industry.

The Dutch government has also taken several measures, following European policy, to create better facilities for succession. Although the family business is partly exempted from inheritance tax, there are facilities to spread payment of taxes and the inheritance laws make it easier to ensure that the company shares go to the intended successor. However, a recent report by the European Commission showed that the Dutch situation is mediocre compared to facilities in countries like Spain, Italy and the UK.

Learning opportunities for family firms
Although an increasing number of family business specialist programmes and  research centres are being developed in the Netherlands, the beginning of the nineties really marked the start of serious research and education activities in family business. Nyenrode University started a research programme and Groningen University had the first graduate course on managing the family business. This was followed, in 1997, by the foundation of the Family Business Centre at Tilburg University. Presently, Tias Business School, Nyenrode University and Erasmus University offer educational programmes such as The Next Generation Programme (Tias) and the Masterclass Family Business (Erasmus).

Although programmes like this exist in other countries, the Netherlands is unique in one respect: there has been a magazine totally devoted to family businesses since 1995. This magazine, called Familiebedrijf, was started by two
brothers and has achieved a top position among dedicated business magazines.

FBNed: bringing together family businesses
In addition to the above opportunities, the Netherlands also has a large and pro-active association dedicated to promoting family business. The 1997 Annual World Conference of the Family Business Network in The Hague inspired a number of Dutch family businesses to join forces and create the Dutch Association of Family Firms, FBNed. Approximately 50 business families meet on a regular basis to exchange experiences and learn both from each other and from other experts in the field. FBNed strives to promote a better image of family businesses not only through the usual interviews and articles but also by liasing with organisations such as the Dutch Federation of Industries.

Another major activity of FBNed is to contribute to the learning of family businesses via the installment of a family business governance committee. Its task is to develop, based on best practice experiences, recommendations for good family business governance. A report, to be published in April, will include recomm­endations for business families pro­­fessionalising their family business and aid responsible ownership.

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