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Danish companies owned by enterprise foundations create DKK 413 billion in value each year, support some 212,000 jobs and contribute around DKK 115 billion a year to the Danish Treasury. Their growth, productivity and earnings track competitors at home and abroad. On value creation, capital structure and innovation, foundation-owned companies rank above companies that are not foundation-owned.

These are among the findings of a new and wide-ranging analysis of the role foundation-owned companies play in the Danish economy, carried out by Bridge Consulting and HBS Economics on behalf of the Lundbeck Foundation and the Carlsberg Foundation.

A pillar that holds when the weather turns

The analysis documents that foundation-owned companies act as a stabilising force in Danish business across a range of parameters. From 2019 to 2024, value creation in foundation-owned companies rose sharply.

The analysis also finds that foundation-owned companies build a stronger capital structure over time than other comparable companies, and that considerably more of them are still in business decades later. The probability that they still exist after 40 years is three times higher than for other Danish companies.

Foundation ownership at the same time keeps companies, headquarters and decision-making power in Denmark, and foundation-owned companies are more likely to keep jobs inside the country's borders. In downturns, too, they hold on to their employees to a greater extent.

One explanation is that foundation-owned companies are over-represented in research- and innovation-intensive industries such as life science, technology and manufacturing, where investments are often long-term and where jobs are hard to move abroad. When these companies grow internationally, the growth is typically accompanied by more jobs in Denmark as well. Today, 34 per cent of everyone working in research and development in the Danish private sector is employed by a foundation-owned company.

The analysis also finds that foundation-owned companies reinvest almost twice as much of their profit per employee as other companies.

The main findings please Lene Skole, CEO of the Lundbeck Foundation, who has followed Danish foundation-owned companies at close range for years:

“The Danish foundation model is unique and often meets with broad international recognition. With this analysis we can now document that foundation-owned companies create value and competitive strength for their owners fully on a par with other forms of ownership. We need that at a time of major geopolitical tension, where we would like to see more companies establish and keep their headquarters in Denmark and Europe,” says Lene Skole, CEO of the Lundbeck Foundation.

Majken Schultz, Chair of the Carlsberg Foundation, which has financed the analysis together with the Lundbeck Foundation, emphasises the strength and potential of foundation ownership:

“Foundation ownership is a strategic strength for Denmark, and we now have even clearer evidence that foundation-owned companies keep jobs, research, innovation and decisions here at home, also when the world around us grows more uncertain. It contributes to a stable Denmark with growth potential, and the enterprise foundations at the same time make grants for the public benefit of around DKK 20 billion a year. We hope the analysis can help inform the political debate, among other things. Not least in light of the appetite for regulation that enterprise foundations periodically encounter from the political side. It creates uncertainty and is without doubt a barrier to more companies of significance choosing the successful form of ownership that foundation ownership is,” says Majken Schultz, Chair of the Carlsberg Foundation.

More generational ownership transitions ahead

The appeal of foundation ownership to owners facing a succession is precisely what the analysis has examined. It arrives at a moment when a historically large number of Danish business owners have to decide the future of their company.

The analysis shows that foundation ownership comes through crises better than any other form of ownership and creates long-term value for Denmark. It is also the model fewest business owners consider when they pass on the baton.

“Far too few owner-managers know the foundation model as an alternative when they have to decide what happens to their life's work. With this analysis, and with the work that now clearly lies ahead in making the foundation model better known, we hope to help turn foundation ownership into a real alternative that business owners spot in good time, and not only once the choice between continuation within the family or a sale has already been made,” says Lene Skole.

According to the analysis, the model rarely enters succession considerations because owners and their advisers fail to bring it into play before the decision has effectively been taken. A deliberate rejection is seldom the explanation. And this is the case even though the model could be a good and real alternative for many companies.

Foundation ownership in Denmark is otherwise a well-tested model, marked this year in particular by the Carlsberg Foundation's 150th anniversary. Brewer J.C. Jacobsen established it in 1876 as the first of its kind in the world. The Lundbeck Foundation, established in 1954 by Grete Lundbeck, is only half as old, but together the two foundations carry more than 200 years of history as owners of a number of well-known Danish companies.