The 100 Largest Global and U.S. Family Businesses and the 100 Oldest U.S. Family Businesses

Insights from the 2019 EY and University of St. Gallen Global Family Business Index

To see the entire Global 500 Family Business Index, visit familybusinessindex.com

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Characteristics of 2019 Index Firms

Average number of employees 48,730

Average age of family businesses: 79.9

Average revenues in US$b: 15.0

Percent that are public companies: 51

There is little change in the geographic distribution of the 500 largest Global Index family firms since the last ranking in 2017, although there is a substantive rise in German firms and a slight reduction in American firms. There is a significant increase in the number of technology firms on the index. New entrants this year tend to be younger and smaller and are more likely to be publicly listed.

For the first time, the index includes data on board composition and characteristics. Both new and previously included firms have boards comprising a majority of non-family members. Most board members are male, and diversity at the board level is lower than among Fortune 500 companies. However, the total revenue represented by these 500 family firms has grown by 9.9% over the last Index, compared with 8.6% in the Fortune 500, underlining the success of family firms in their ability to compete effectively.

An analysis of the “average” firm shows little significant change between 2019 and 2017. Average employee numbers have risen slightly; average firm age has dropped a little, from 80.38 years in 2017 to 79.92 years in 2019; average revenue has risen to about US$14.97b in 2019 from US$13.62b in 2017; and on average, 51% of the index's family firms are public, compared with 48.6% in 2017.

“It is not surprising that when we are analyzing the very largest family companies in the world, average characteristics will not change dramatically year-on-year,” says Marnix van Rij, EY Global Family Business Leader. “Analysis of new entrants is where we see more trends.”

“Overall, there are fewer new entrants in the 2019 Index than there were in 2017,” says Professor Thomas Zellweger, chair of the Center for Family Business at the University of St. Gallen. “The most significant shifts are the addition of 11 new German firms this year and significantly fewer new U.S. firms, seven compared with 49 in 2017.”

Unsurprisingly in this age of transformation, the Family Business Index this year sees significant increases in family businesses that are leveraging new technologies. This year, 65 firms operate in smart infrastructure (compared with just 35 in 2017), and 123 firms are in advanced manufacturing and mobility (compared with 103 firms in 2017).

By contrast, there are fewer firms in financial services (40 firms this year, compared with 61 firms in 2017) and in consumer products and retail (down 21%, from 202 firms to 160 this year).

For all that, there are more family businesses operating in consumer products than in any other industry market, with just under one in three (32%) of all Family Business Index companies operating in consumer products.

The majority of new entrants to the index this year operate in advanced manufacturing and mobility, while consumer products is the second-largest source of new entrants.

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This list of the 100 largest U.S. family businesses is a subset of the largest 100 global family businesses compiled by EY and the University of St. Gallen.

To see the entire Global 500 Family Business Index, visit familybusinessindex.com

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In 2019, there is substantial data on the board composition and CEO profile of each firm to give insight into the corporate governance of these large family-controlled companies. (Please note that this information is available at familybusinessindex.com and is not presented in the charts published in Family Business Magazine). For firms that also appeared in the 2017 index, more than a quarter (27%) of board directors are family members, the balance being drawn from outside the family. In comparison, for new entrants to the index this year, more than a fifth (23%) of board directors are drawn from the family, while almost four-fifths (77%) are non-family members. “Newer, younger companies are more likely to harness the expertise and perspectives of external directors from outside the family,” says van Rij, “but they also have fewer family members to draw from than family firms in the third or fourth generation.”

Family members serving on their companies' boards are overwhelmingly male—84% versus 16% female family board members. “Interestingly, we see no major improvement in diversity in new entrants to the Index,” says Zellweger. Women serve on only about 7% of the boards of these new entrants, he notes. Comparing the participation of female family members in the running of their companies with the 20% female directors of Fortune 500 companies, female family members are significantly less likely to be active on the board.

In the 2018 EY Global Family Business Survey, in which 525 of the world's largest family businesses were interviewed, board membership overall (including non-family members) comprised 16% women, a 20% increase on the 2014 survey. This suggests that family businesses may be better at harnessing female talent from outside the family than they are at engaging family members at the highest executive levels.

More than half (55%) of the CEOs in the 2019 index are non-family men, reflecting an increasing professionalization of the management of the world's largest family businesses, while 41% are run by a male family member. New entrants this year are more likely to be led by a family member than older incumbents, with 57% having a family CEO. This finding may reflect smaller and younger family companies' need to rely on family capital for growth, van Rij says. By contrast, “the very largest companies are more likely to utilize external sources of management.”

Just 4% of the companies on the index have a woman at the helm, 10 drawn from the family and eight from outside. New entrants are marginally more likely to have a female CEO (6%, compared with 3% of existing companies), but the numbers are too small to indicate any significant trend. This shows that family businesses are similar to Fortune 500 companies in CEO diversity: Just under 5% of Fortune 500 companies were run by a female CEO in 2018. Interestingly, diversity may be an area where smaller companies are more progressive. In the 2018 EY Growth Barometer survey of some 400 middle-market family businesses (with revenues under US$3b), family firms were significantly more likely than non-family firms to have a female CEO (9% compared with 3%).

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Family Business Magazine has long presented a ranking of the 100 oldest family businesses in the United States. Our first list appeared in 1999, based on research by the late Professor William O'Hara, former president of Bryant University in Smithfield R.I., and his associate Peter Mandel. The list has since been updated multiple times. Our last significant update was published in 2011.

Each time we publish the list, “new” companies that might qualify emerge. This latest ranking includes several companies we missed in previous lists, and excludes several companies that were sold out of family ownership or went out of business in the past decade.

The year 1850 is a pivotal one for the current list. That's the year of founding for those tied as the “youngest” of the oldest American family businesses, meaning that all the companies on this list are 169 years old at minimum. The very oldest company, Avedis Zildjian Co., is just four years shy of its 400th birthday, and already well into Generation 15 and 16 of family ownership. Ten companies on our list were founded before 1700, and 25 were founded before 1776, the birth year of the United States.

As always, farms and agricultural companies dominate among these elder American firms, followed closely by funeral homes. But there are a number of other business types to be found, including jewelers, pharmacists and flag makers.

If, after all these years, we've still missed a company that should be included, please contact David Shaw, Family Business Magazine's publishing director, with further details. He may be reached at dshaw@familybusinessmagazine.com.