Why We Must Advocate
At Active Directions, we’re proud to champion mid-market firms, small and medium-sized enterprises (SMEs), and family-owned businesses as they are the backbone of our economy and communities.
This is the first in a five-part series exploring how we, as a sector including business owners, advisers, industry groups, corporates, and government can step up our advocacy. Together, we can elevate the visibility, voice, and value of these enterprises.
A Sector That Powers Economies and Communities
SMEs and family businesses are more than economic contributors, they are job creators, innovators, and community builders. In this article, we highlight their impact and explore how we can better advocate for their future.
Economic Contribution
In Australia, SMEs make up over 99% of all businesses and contribute more than half of private sector GDP. Family businesses account for around 70% of enterprises, offering long-term investment, stability, and generational continuity. Mid-market firms play a vital role in scaling innovation and connecting local industries to global markets.
Globally, the story is similar:
- In the UK, SMEs represent 99.9% of businesses and contribute £1.3 trillion annually. Family businesses generate nearly one-third of GDP.
- In Canada, SMEs employ 88.3% of the private labour force and are key players in agriculture, retail, and manufacturing.
Employment and Opportunity
SMEs are major employers. In Australia, they provide jobs for over 7 million people. Their flexibility supports youth employment, career transitions, and workforce diversity. Mid-market firms offer stable roles and clear career pathways. Family businesses often prioritise long-term employment and staff wellbeing. These are values that resonate deeply with local communities.
In the UK, SMEs employ more than 16 million people. Their presence in every region ensures broad access to jobs. In Canada, SMEs are the primary employers in rural and Indigenous communities, helping build local capacity and inclusion.
Regional and Community Development
Private and family-owned businesses are often the lifeblood of regional economies. They provide jobs, services, and local investment that keep communities thriving. When these businesses succeed, they support supply chains, sponsor local events, and help retain population.
But when they decline or disappear, the impact is immediate and far-reaching. In towns like Geelong and Whyalla, the loss of key industries and family-run firms has led to job losses, reduced spending, and population decline. Similar patterns are seen in the UK’s Midlands and Northern towns, where closures of local manufacturers and retailers have contributed to economic stagnation.
Without thriving private enterprise, regional communities risk being hollowed out. Public investment alone cannot replace the deep local ties and long-term commitment that family businesses bring.
The Role of Business Owners
Business owners are the most powerful advocates for the sector. Their lived experience shapes public understanding and policy. By sharing stories, participating in consultations, and engaging in forums, they influence decisions that matter.
We encourage business leaders to:
- Contribute to surveys and policy submissions
- Provide feedback on legislation
- Collaborate with peers to amplify their collective voice
The Role of Advisers and Industry Associations
Advisers — accountants, lawyers, consultants — play a crucial role in translating business needs into policy language. They identify trends, shape submissions, and help businesses navigate change.
Industry associations represent thousands of businesses. They conduct research, lobby policymakers, and run public campaigns. In Australia, groups like Family Business Australia and COSBOA are leading voices. Similar bodies in the UK and Canada play equally vital roles in sector development.
The Role of Government
Governments recognise the importance of SMEs and family businesses, but support is often fragmented and short-term. A unified, long-term strategy is needed to position these businesses as essential economic drivers.
Key areas for action include:
- Structural Reform: Develop a national strategy that embeds SMEs and family businesses into long-term economic planning.
- Access to Capital: Expand loan guarantees and alternative funding options to unlock growth, especially for asset-light businesses.
- Level the Playing Field: Streamline procurement and reduce compliance costs to help SMEs compete with large corporates.
- Digital and AI Transformation: Provide targeted grants and training to support digital adoption and global competitiveness.
Let’s Lead the Conversation Together
SMEs and family businesses are not just part of the economy; they are its foundation. They deserve a stronger voice, better support, and a seat at the table.
If you’re a business owner, adviser, or advocate, we invite you to join the conversation. Share your story. Shape the future. And let’s build a stronger, more inclusive economy together.
