Over half of Taiwan family businesses face succession issues: report

Source: Xinhua| 2019-07-22 18:25:04|Editor: Li Xia
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TAIPEI, July 22 (Xinhua) -- Over half of the family businesses in Taiwan have been taken over by the second generation of owners or are about to go through the process, according to a report issued Monday in Taipei.

About 10 percent of the 305 family business owners surveyed said they have already passed their businesses on to their children while 44 percent said they are about to do so, according to a report issued by accounting firm PricewaterhouseCoopers (PwC).

Only 13 percent of the respondents said they will entrust professional managers to run their businesses.

The report found that 56 percent of the family businesses in Taiwan are currently run by their first-generation owners and 35 percent of them are run by second-generation owners. Only nine percent of the businesses have been passed on for three generations or more.

Business owners of advanced age tend to want their children to take over the family business, while those at a younger age are relatively open to their children taking a different career path -- 77 percent of owners aged under 59 support their children starting their own businesses.

Family businesses in Taiwan, many of which "champions" of their industries, focus more on optimizing products than other companies, the report showed.

It also found that family businesses generally do not believe acquisitions to be an important strategy. They also believe wills are the most important means of wealth distribution, followed by family trusts.