The UK's small businesses are leading the way in adopting flexible working practices and are benefiting from increased loyalty as a result, research suggests.

A study by Citrix Online found that almost three-quarters of small companies already offer some flexible working arrangements and almost half welcomed government plans to extend the right to request such provisions to parents of older children.

Being able to work away from the office was seen by mothers as the top benefit a company could offer, ranking it above more traditional benefits such as a company pension, while fathers placed it above extended paternity leave as the factor making the most positive difference in their child's first year.

"Working parents worry about the effect that having children will have on their career aspirations, so it is promising to see that businesses are recognising the benefits of flexible working and introducing options that will really help employees," said Denise Tyler, founder of Mother@Work.

From a small business perspective, the main benefits of flexible working were seen as higher employee satisfaction, cited by 66% of respondents, greater levels of staff retention (58%) and a better work/life balance for parents (48%).

But the research also revealed concern among small business managers over proposals to increase maternity leave from 39 to 52 weeks and to allow fathers to take up to 26 weeks of this entitlement if the mother returned to work.

It seems such concerns are not limited to small business managers and owners, with almost half (46%) of fathers and 44% of mothers admitting they thought they would be jeopardising the careers by taking extended periods of leave.