Family business succession is set to become a defining issue for the French economy as the next decade brings a wave of leadership changes across the sector.
Family-owned firms account for 71% of all companies, employ 69% of the workforce and generate 65% of GDP, according to a 2024 study by the Paris Dauphine-PSL chair on family enterprises.
Demographic trends are tightening the timeline. One in four family-business leaders is already over 60, and the baby-boom generation is approaching retirement, creating a pressing need for orderly handovers.
Despite the urgency, many owners are unprepared. More than a third of CEOs older than 70 have not formalised any succession plan, while half of those aged 60-69 and three-quarters of 50-59-year-olds remain without a written strategy, a gap highlighted by the BPI Le Lab study.
Planning and fiscal tools
The Dutreil pact remains the cornerstone of tax-efficient transfers. When applied, it can exempt up to 75% of a company’s value from inheritance or donation taxes, provided strict conditions on share retention are met.
According to the latest barometer, 85% of recipients report using the Dutreil mechanism, showing its widespread adoption.
Donations are the preferred method for many transmitters, with 62% planning a donation-share and 16% opting for a simple donation. In 18% of cases, owners employ a split-ownership structure to lower tax burdens while keeping dividend rights.
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Most families aim for an equal split of shares, 67% follow this model, though debates are emerging about aligning ownership with operational involvement.
In practice, the combination of fiscal incentives and equal-share preferences can create tension when the successor who assumes day-to-day management does not automatically gain majority voting power.
Only 14% of family firms have a formal family charter and 18% maintain a family council; 8% combine both.
Without clear governance structures, the risk of conflict rises, especially when the outgoing leader retains significant influence.
Governance and leadership handover
Data show that 78% of owners who have not yet considered succession lack any formal governance framework, a shortfall that hampers smooth transitions.
Even after a transfer, many founders stay involved: 6% describe themselves as fully withdrawn.
Most owners still favor keeping the business inside the family, with more than four out of five opting for an intrafamily transfer. In the majority of these cases, the new leader assumes the chief executive role, reinforcing continuity at the top.
