The French statistics on enterprise groups and the globalization Raoul Depoutot, INSEE, FRANCE Dominique Francoz, INSEE, FRANCE.

The French statistics on enterprise groups and the

globalization

Raoul Depoutot, INSEE, FRANCEDominique Francoz, INSEE, FRANCE

The economic context

• Restructuring of economic activity

• Globalization

• Outsourcing

Outline of the presentation

• The statistical system to observe enterprise groups

• The economic use to follow up the globalization

• The ongoing projects

The organization of information on enterprise groups

LIFI

DIANE

DREE

TREASURY BOARD

SUSE

The survey on FInancial LInks (LIFI)

• The target population :

Firms reaching one of the following criteria :– Total amount of equity interest > 1,2 M€– Number of employees > 500– Turnover > 30 M€– Head of an enterprise group– directly controlled by a foreign corporation

The survey on FInancial LInks (LIFI), cont’d

• Information included in the questionnaire :– Identification characteristic of the surveyed firm

– Information on the shareholders

– Information on the affiliates or subsidiary of the firm

The survey on FInancial LInks (LIFI), cont’d

• Variables included in the questionnaire :

For each shareholder of the surveyed company

For each subsidiary or affiliate of the surveyed company

- ID number- activity

- % of capital

For the surveyed company : ID number, main activity, corporation name, adress, legal status, number of employees, total value of majority and minority interests

- corporate name- adress (nationality)

- percentage of voting rights

The LIFI survey, cont’dDesigning each group of enterprises

• Statistical unit : enterprise group

• Definitions :– Enterprise group– Head of the group– Core of the enterprise group– Extended enterprise group

100 %

40 %

S4

S1

S2S3

S5

S12

S11

30 %

40 %

20%

80 %

Source : Insee Poitou-Charentes – Service statistique – Pôle national « Liaisons Financières »

The survey on FInancial LInks (LIFI), cont’d

• Need to complete this information– Enlarge the target population– Have more information on foreign activity

(foreign affiliates and foreign parent companies)

– Add economic variables

The LIFI survey, cont’d :

Source : Insee Poitou-Charentes – Service statistique – Pôle national « Liaisons Financières »

If F1 surveyed

?

E1F3

F2F1

G2G1?

Trésor

E1

France

F2

Abroad

F1

G1

E2E3

?

F3

?

Dree

Diane

DIANE

• To enlarge the target population– Private database edited by COFACE SCRL

and BVD– Information published by the French

corporation courts– Data on small firms

The DREE survey

• To better cover the affiliates abroad– Survey on French affiliates followed up by

the commercial offices in the French Embassies

– To have information on the ultimate host– To have economic information on the

French affiliates abroad (turnover, employees)

The Treasury Board information

• To better cover the foreign parent companies– Administrative information– To have information on the ultimate

beneficial owner– To better attribute a citizenship to the

firms under foreign control

The SUSE data

• To include economic data– Result of both administrative and survey data– At the level of legal units– Available :

• Income statement• Balance sheet• Main activity code• Breakdown of sales by product• Workforce characteristics

Some results …

Number of enterprise groups 2002

Share of economic activity under foreign

controlFrench groups 24 302Foreign groups 7 031 22,4%Total 31 333

incl micro-groups (<=500 empl.)Number of legal units involved French legal units 89 527Legal units under foreign control 17 686 16,5%Total 107 213Number of employees ('000)French groups 11 995Foreign groups 1 952 14,0%Total 13 947Value added (in M€)French groups 616,0Foreign groups 130,3 17,5%Total 746,3Source : INSEE (LIFI , SUSE), DIANE (co-edition Bureau Van Dijk/COFACE SCRL)

The use of the LIFI data in the economic analysis of globalization

• The weight of foreign firms in the economic activity

Breakdown of resident corporations (France – 2002)

0

10

20

30

40

50

60

70

80

90

100

Number of corporations Value added Own capital Number of employees

Independent corporation

Corp. of a listed French EG

Corp. of a non-listed French EG

Corp. of a foreign EG

Development of the foreign controlled economy

Employees ('000)

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

French EGs

Foreign Egs

Independent companies

The use of the LIFI data in the economic analysis of globalization

• The weight of foreign firms in the economic activity

• Globalization and outsourcing of French activity

The use of the LIFI data in the economic analysis of globalization

6,0

2,0

3,8

2,0

Indep.

EGs3.5

100% Fr

Foreign

France RoW

Millions of Employees

The current and future developments

• To consider enterprise groups as statistical units– To define economic entities in the frame of

group which will be the collection units (profiling)

– To develop a statistical register of EGs– To produce consolidated economic data on

EGs– To integrate the EG as a data collection unit

The current and future developments, cont’d

• To develop a statistical register of EGs– To define the continuity of EGs

• Develop relevant concepts for EGs demography• Analyze the result of mergers / split off

– To coordinate with other French statistical offices

– To improve the registration of foreign corporation (abroad)

The current and future developments, cont’d

• To produce consolidated economic data on EGs– To avoid double counts on some variables

(Financial assets, sales)

The current and future developments, cont’d

S2Consolidation of sales:

2500

6000

2001500

300

S3

S1500

S2b

250150

500

= Economic flow

Statistical RealS1 3300 2500S2 6250 6000S2b 350 200S3 2000 1500

The current and future developments, cont’d

• To produce consolidated economic data on EGs– To avoid double counts on some variables

(Financial assets, sales)

– To have a better information of the international activity of MNEs

To produce consolidated economic data on EGs : an example

0

100000

200000

300000

400000

500000

600000

700000

800000

900000

1997 1998 1999 2000 2001 2002

Consolidated turnover - world

Consolidated turnover - France

The current and future developments, cont’d

• To produce consolidated economic data on EGs : some difficulties– Not compatible with the national territory

– No currently available for many EGS

– National sub-consolidation expansive

The current and future developments, cont’d

• To integrate the EG as a data collection unit– A first experience : the survey on intangible

assets (R&D and innovation, patents and licensing, marketing)

Thank you for your attention

Insee Poitou-Charentes – Service statistique – Pôle national « Liaisons Financières »