R&D

SMEs and innovation: only one in ten invests in research and development

However, investment has risen by 17 per cent over four years, according to research by the Polimi School of Management

21 June 2026

3' min read

Translated by AI

Versione italiana

Key points

The champion
Family capitalism
The challenges of the future

3' min read

Translated by AI

Versione italiana

Good, but not great: investment in innovation and digitalisation is on the rise amongst Italian family businesses. However, the number of those investing in research and development is still too low and, above all, has fallen in recent years.

The report ‘Innovation in Italian small and medium-sized family businesses: measuring, promoting and communicating it’, produced as part of the IF! (Family Businesses, Innovation, Future) Project run by the Innovation Strategy & Family Business group at the Polimi School of Management, highlights that just one in ten includes research and development expenditure in its accounts, and that between 2020 and 2024 this figure fell by 11 per cent.

During the same period, however, total investment grew by 17 per cent, becoming more structured and concentrated in fewer companies, which generally had a smaller proportion of family ownership and were therefore more open to outside investment.

The champion

The research – carried out in collaboration with the Centre for Young and Family Enterprise at the University of Bergamo, with the PwC Italia Foundation as a strategic partner and Assolombarda and Vistage as partners - analyses over 6,300 family-owned businesses with a turnover of between 20 and 150 million euros, combining a rigorous methodological approach that integrates financial statement and patent data, insights gained from analysing LinkedIn posts, 40 interviews with senior executives and three workshops involving over 50 companies.

The most innovative companies are located along the north-eastern industrial corridor, spanning Lombardy, Veneto and Emilia-Romagna. As for the distribution of expenditure, companies between 11 and 50 years old account for almost 80 per cent of R&D spending, whilst younger and older firms invest considerably less. There are over 75,000 patents, but these are concentrated in just a quarter of the companies analysed, and serve a defensive rather than a proactive purpose. Entrepreneurs recognise the value of AI, but see it as a tool to ensure they do not fall behind in a rapidly changing landscape, rather than as a strategic lever for growth. Finally, 7 out of 10 companies have a LinkedIn profile but dedicate only 1 in 8 posts to innovation.

Family capitalism

On average, the sample analysed reflects the typical characteristics of Italian family-run businesses: a predominance of manufacturing and commercial firms, a strong concentration in Northern Italia, an average age of around 35 years, an EBITDA margin of 7 per cent and a ROE close to 11 per cent (indicating sound financial health), with the majority being limited liability companies (59 per cent). A Family SME Innovation Index was then compiled for each company, measuring their drive for innovation by combining resources invested, results achieved and profitability: this made it possible to draw up a ranking of the top 100 companies, which are concentrated in the North-East.

In relative terms, the propensity to invest in R&D appears to be higher in the South than in the industrial North (Puglia leads the way with 15.9% of innovative SMEs; followed by Sardinia, 14.9%; Lazio, 12%; Campania, 10.4 per cent; Piedmont, 10.1 per cent; and Veneto, 9.1 per cent): Lombardy, which tops the sample with 163 innovative firms, remains below the national average of around 9.9 per cent. In reality, much of the innovation in businesses within the northern industrial clusters is relational and supply-chain-based, and therefore does not appear to be attributable to individual firms.

“Family-run SMEs are at the heart of Italia’s socio-economic system and play a key role in many sectors that drive the ‘Made in Italy’ brand around the world,” explains Emanuela Rondi, director of the IF! project, “yet they remain on the fringes of the debate on innovation, which focuses on start-ups, large technology groups and research centres. We, on the other hand, wanted to focus on them and engage with them, discovering that they innovate far more than their financial statements would suggest: these are mostly incremental improvements, solutions developed on the ground, and collaborations with customers and suppliers that standard tools only partially capture. To truly understand this, we need to combine the analysis of numerical data with listening directly to those involved.”

The challenges of the future

This analysis highlights the three challenges on which the future of family-run SMEs hinges: ‘measuring innovation, so as to be able to manage it; capitalising on it, transforming it into a competitive advantage that leads to financial results; and communicating it, so as not to lose any of its potential value. Not to mention the generational issue: ‘Much of the outcome depends on the dialogue between those running the business and those taking over,’ adds Rondi.

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