THE huge contribution made by Scotland’s leading family-owned firms to the country’s economy and employment levels has been underlined by a major new report.

The Scottish Family Business Top 100 report, published for the first time today, reveals that the country’s 100 most profitable family-owned companies generate a combined £1 billion of pre-tax profits, turning over a huge £16.6bn on a collective basis.

Employing more than 100,000 staff, the enterprises were found to contribute 11 per cent to Scotland’s onshore gross domestic product (GDP).

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The study, published by Family Business United (Scotland), is based on information filed by Scottish-registered firms at Companies House by March 31 this year, analysed by family business adviser Craig Corporate and Edinburgh’s Queen Margaret University.

And it revealed that Scotland’s most profitable firm was William Grant & Sons, the Scotch whisky distiller established in 1887. Owned by the Grant Gordon family, it made a pre-tax profit of £177.2m in its last financial year, turning over £882.5m and employing more than 1,900 staff.

Scotland’s biggest family firm by turnover, and second most profitable, was motor retailer Arnold Clark, according to the report. Founded by the late Sir Arnold Clark in 1954, the company turned over £3.4 billion, its most recent accounts show, with profits of £110.4m. It employs nearly 10,000 staff across some 200 branches, with the company one of eight motor retailers in Scotland which made it into the top 100. The sector was found to be the dominant sector among the leading family-owned businesses, turning over a collective £5.4bn- more than 32 per cent of the total top 100 turnover.

Meanwhile, Lord Willie Haughey’s City Refrigeration Holdings (UK), recently renamed City Facilities Management, was ranked as Scotland’s biggest family-owned employer. The study found the Glasgow-based firm employs 12,047 across its increasingly global operations. For the period covered by the report, City made pre-tax profits of £13.5m on turnover £463.1m.

Tom Craig, chairman of Craig Corporate, and chair of Family Business United Scotland, said the study was commissioned because the contribution made by Scottish family firms has been “grossly under-recognised” - both among the general public and the political classes.

Mr Craig said: “There is a kind of mind-set that says family businesses are little companies, but the reality is that they are very substantial. That Top 100 make something like £1 billion of profits – that is a huge thing. That was really the motivation – to try to get better recognition and understanding of the contribution they [family businesses] make.”

Asked if the findings surprised him, Mr Craig replied that the impact of the top 100 firms did exceed his expectations. With research suggesting the number of family businesses in Scotland runs into “six figures”, he said: “I was quite surprised at just how much the 100 companies were contributing to the economy, and the employment.”

As well as the financial impact made by such firms, Mr Craig added that the “longevity” of many was also impressive. “Once they get established, [family firms] tend to last for quite a long time. If you look down that list, most of these companies have been around for several generations. That is a great thing to have, particularly for an economy like Scotland which is dependent on inward investment.

“Multi-nationals can make decisions to close businesses in Scotland in a way family companies wouldn’t. They are much more patient about their capital returns. They also make huge contributions to their local communities – a lot of family businesses have been in a particular area for upwards of 100 years. That is in the wider sense of family businesses, as opposed to just the biggest ones.

“My personal view is that if we have more family companies it will be good for the long-term growth of the Scottish economy, because of the stability and the patient nature of growth.”

Mr Craig hopes the research will now be carried out annually, adding that there is an appetite to expand the study into family firms which are smaller in scale.

Simon Hunt, chief executive of William & Grant & Sons, said: “We’re delighted to be recognised in the Scottish Family Business Top 100 category alongside some of the some of the most respected companies in the Scottish market.”