In 2007, the AIDAF-EY Chair in Family Business Strategy, AIDAF (Italian Association of Family Businesses) and the UniCredit Group launched the first National Observatory on Italian Family Businesses. Over the years, Borsa Italiana, the Milan Monza-Brianza Lodi Chamber of Commerce, Cordusio and the Angelini Foundation have also decided to join as sponsors.
The Observatory monitors all Italian companies with a turnover of more than 20 million euros (17,984 companies as of 31.12.2018), and then focuses in greater detail on the more than 11,808,000 family-controlled companies, which have a total turnover of over 800 billion euros and employ around 2.3 million workers. Based on the criteria adopted by the AUB Observatory, the following companies are defined as family businesses:
- Unlisted companies, controlled by one or two families with an amount of shares greater than or equal to 50%;
- Listed companies, controlled by one or two families with an amount of shares greater than or equal to 25%;
- Companies controlled by a legal entity attributable to one of the two situations mentioned above.
In some cases, to avoid duplication due to business groups, the Observatory makes a selection based on the degree of diversification. In particular:
- In the case of mono-business groups: the controlling companies are considered in the following cases: i) the controlling company is a pure holding company; ii) there is only one operating subsidiary with revenues exceeding € 20 million); iii) the consolidation perimeter of the parent company coincides with the size of the main subsidiary. All subsidiaries, both first and subsequent levels, are excluded.
- In the case of multi-business groups: controlling companies (often financial companies) are excluded and only subsidiaries (operating) at the second level of the control chain are included. The subsidiaries at the third and subsequent levels of the control chain are also excluded since the information is largely contained in the financial statements of the second-level parent companies, included in the list according to the criteria indicated.
The AUB Observatory (AIDAF, UniCredit, Bocconi) has detailed and updated information on the following topics:
Ownership structures: data relating to the composition of the shareholder base, with timely information on the top 7 shareholders
- Governance structures: data relating to the composition of the Board of Directors - starting from 2007 - on age, length of service in the office, gender, familiarity and position held (simple director, director with proxies, Sole director, chairman, chief executive officer). The data are extracted and encoded from the chamber of commerce registration form filed with the Chamber of Commerce.
- Economic and financial performance: main income statement, balance sheet and balance sheet indicators (Source: AIDA)
- M&A operations: data relating to the acquisition of control over target companies (in Italy and abroad) carried out by the companies monitored by the observatory starting from the year 2000
- Internationalization through FDIs: data relating to Foreign Direct Investments (FDI), namely investments with a share capital exceeding 10% (Source: Orbis)
- Internationalization through export: limited to companies with turnover exceeding 50 million euros, export data are available starting from 2011 (Source: company report)
- Dividend payout: limited to family firms with turnover exceeding 50 million euros, the data relating to the amount of dividends paid starting from 2011 is available (Source: company report)
The Observatory therefore has the most complete and extensive monitoring available in Italy on family-controlled companies and aims to help researchers, entrepreneurs, managers and institutions to understand the unique characteristics and needs of this particular type of company.