DEBATE: “Businesses of the future start with today’s handovers”

Sweden is facing a major generational shift over the next ten years. In this debate text, the Confederation of Swedish Enterprise expresses an expectation that the government will not make it more difficult for the thousands of companies facing transfers.

With over 80,000 small and medium-sized enterprises facing generational change in the next ten years, it is not only a challenge but also a huge opportunity for Sweden to strengthen its business climate. SMEs are the backbone of Sweden’s economy and play a crucial role in creating jobs, innovation and growth – not least in rural areas, where they are often the heart of the local community.

Looking ahead, a key issue is to consider how to create the best possible conditions for succession and transfers, as analyzed in Anders Ydstedt’s new book “Ö som i Överlåtelser”. It makes clear that Sweden has already made important progress. The abolition of the inheritance and gift tax twenty years ago (2004) and the wealth tax (2007) have made it easier for smaller family businesses to survive. These reforms have also contributed to a stronger corporate sector with increased economic activity and the emergence of several Swedish success stories, including several successful growth companies. At the same time, challenges remain. Regulations and taxes, such as the complex 3:12 rules, risk making succession more difficult, especially for smaller companies. This makes it even more important to continue to simplify and create long-term, predictable rules that enable investment and long-term development.

Many describe an emotional struggle between respecting the will and vision of previous generations, while feeling the need to put their own stamp on the company.

Business owners testify to both opportunities and emotional challenges during transfers. The challenges span many areas – from managing the equity perspective between siblings and family members to bearing the responsibilities of new ownership and managing a legacy that often represents the hard work of generations. Many also describe an emotional struggle between respecting the will and vision of previous generations, while feeling the need to put their own stamp on the business. There can be sadness and loss when family members pass away, sometimes changing the ownership structure and family dynamics. Others feel pressure from others to succeed or experience doubts about whether they want to follow in their parents’ footsteps.

These stories remind us that businesses are not only economic entities but also living organizations. They carry values that go far beyond balance sheets – they are filled with history, vision and the responsibility that comes with creating jobs and opportunities for others. This is precisely why it is so important to create the conditions for generational transitions and transfers to be a positive and sustainable journey, both for businesses and for the people affected by them.

Businesses carry values that go far beyond balance sheets – they are filled with history, vision and the responsibility that comes with creating jobs and opportunities for others.

The best way for the state to secure future prosperity and welfare is to make it easier for entrepreneurs. This will also increase tax revenues. The government needs to make it clear that no tax increases or other burdens will be imposed on businesses in the coming years; long-term rules are crucial. The successful reforms of the entrepreneurial tax (3:12), which have demonstrably generated increased entrepreneurship, job creation and tax revenue as a result, need to be followed by more successful reforms that pave the way for and invite businesses to be transferred instead of being wound up.

Because if we look 20 years ahead, what do we want history to say about our business climate? The vision is clear: a Sweden where viable businesses can live on for generations, create jobs and innovations, and be an engine for social development. Together, politicians, entrepreneurs and society at large can create the conditions for this. But it requires courage, will and a realization that every company that survives a generational change, whether a family member or someone else takes over, is a victory not only for the entrepreneur but for the whole of Sweden.

Anna Hedensjö Johansson, Head of SME Affairs at the Confederation of Swedish Enterprise