scholarly journals The Importance of the Governance Role in Achieving Stability and Sustainability in Family Business Companies Through Generations

2021 ◽  
Vol 7 (3) ◽  
pp. 16
Author(s):  
Samir A. Abdelaziz
Keyword(s):  
Corporate Governance ◽  
Family Business ◽  
Global Economy ◽  
Business Models ◽  
Good Governance ◽  
Business Owners ◽  
Family Businesses ◽  
Governance Risk ◽  
The Relationship

Family businesses have continued to draw researchers' attention due to their strategies while making sustainable decisions. Notably, these business models deserve more recognition in this discourse, considering that they contribute up to 70% of the global Domestic Product. This article focuses on some drivers to sustainable decisions revolving around three pillars: environmental, social, and economic. The author's aim in this context is to provide a statistical model that could be used to forecast revenue trends to establish if family businesses are poised for sustainability or not. The models essentially allow for an analysis of the relationship between family businesses' internal drivers with corresponding financial objectives.However, these business models may fail to achieve their objectives if they do not embrace good governance, allowing them to react to challenges. Corporate governance is an essential framework that companies use to reconcile individual, community, business owners, and shareholders' interests in a dynamic global economy. Companies that align with the principles of good governance are more likely to remain sustainable, stable, and profitable. In retrospect, business enterprises that ignore the provisions of corporate governance risk facing uncertainties, most notably, dissolution and bankruptcy. The second, third, and subsequent generations fail to internalize and advance the founder's long-term organizational goals.This study adds to the existing literature on economic sustainability of family businesses characterized by market value and higher revenue generation.

Family Business Governance

2021 ◽  
pp. 24-40
Author(s):  
Reena Agrawal ◽  
Ganga Bhavani
Keyword(s):  
Corporate Governance ◽  
Best Practices ◽  
Family Business ◽  
Family Businesses ◽  
Business Strategies ◽  
Business Organizations ◽  
Substantial Portion ◽  
Advantages And Disadvantages ◽  
The World

Corporate governance is a significant tool to build strong and long relationships among various stakeholders in kinds of business organizations. Family businesses are not an exception to this. Like any other businesses, family businesses also need to have governance in place and practice to achieve the business strategies and to have long-term succession. Family-owned businesses are the backbone of many countries' economies in the world contributing substantial portion of GDP. Considering these, it is important to know the best practices of governance in family owned business organizations and the role played by governance to improve the strengths of these businesses. The chapter throws light on family business governance and explores various important practices highlighting their advantages and disadvantages in detail.

scholarly journals The Main Drivers for Sustainable Decisions in a Family Business That Impact the Company’s Performance

2020 ◽  
Vol 12 (20) ◽  
pp. 8659
Author(s):  
Adriana Cioca ◽  
Kassam Wehbe ◽  
Delia Popescu ◽  
Constanta Popescu
Keyword(s):  
Human Resources ◽  
Family Business ◽  
Investment Decisions ◽  
Family Businesses ◽  
Economic Sustainability ◽  
Short Term ◽  
Sustainable Performance ◽  
The Relationship ◽  
Good Operation

The successful ways in which families have conducted their businesses decade after decade have drawn scholars’ attention to what the mainstream ideas are when it comes to making sustainable decisions. This article focuses on the main drivers behind sustainable decisions made by family businesses with respect to three pillars: economic, environmental, and social. In this context, the authors’ aim is to present a statistical model for forecasting companies’ future revenue in the next financial year by analyzing the relationship between the main internal drivers of family businesses and their corresponding financial objectives. Additionally, the analysis of the long-term strategy and the short-term actions indicates an understanding of environmental awareness. Reaction time in investment decisions represents a challenge for the sustainable performance of family companies. Human resources with good operation management in family businesses contribute to the assurance of long-term business stability and high returns on investments. The results will contribute to the literature on economic sustainability of family businesses.

scholarly journals The relationship between corporate governance and firm performance revisited: where do we stand?

2010 ◽  
Vol 7 (3) ◽  
pp. 124-137 ◽  
Author(s):  
Stefan Hilger
Keyword(s):  
Corporate Governance ◽  
Business Models ◽  
Corporate Performance ◽  
Holistic Approach ◽  
Governance Mechanisms ◽  
Governance Practices ◽  
The Usa ◽  
The Impact ◽  
The Relationship

How is corporate governance measured, and what is the relationship between corporate governance mechanisms and corporate performance? This paper aims to shed light on these questions by providing an overview of the most important research findings in this area with a focus on the USA and Germany. My analysis gives rise to the following remarks. First, studies examining the impact of singles governance mechanisms are inconclusive and mixed in their findings, and especially the question of causality is still unanswered. Second, when a holistic approach is used, the proposition that good corporate governance enhances long-term performance is supported. However, corporate governance practices alone cannot assure long-term corporate performance and good standards of corporate governance are no substitute for the solidity of business models.

scholarly journals The Moderating Effect of Family Business Ownership on the Relationship between Short-Selling Mechanism and Firm Value for Listed Companies in China

2021 ◽  
Vol 14 (6) ◽  
pp. 236
Author(s):  
Wenzhen Mai ◽  
Nik Intan Norhan Binti Abdul Hamid
Keyword(s):  
Corporate Governance ◽  
Family Business ◽  
Value Creation ◽  
Firm Value ◽  
Panel Data Analysis ◽  
Listed Companies ◽  
Short Selling ◽  
Family Businesses ◽  
External Governance ◽  
The Relationship

This study demonstrates an investigation of the external corporate governance effect of short selling mechanisms on firm value in the Chinese context. The effect of family businesses is also examined as a moderator of the relationship between short-selling and firm value. Using panel data analysis of Chinese listed companies, this paper tests a total sample of 22,468 firm-year observations from the Shanghai and Shenzhen Stock Exchange from 2009 to 2019 by applying the PSM-DID method in order to mitigate self-selection and endogenous problems caused by the uniqueness of Chinese short selling mechanisms. The findings suggest that both deregulation and the propensity of short selling can improve the firm value. Our findings also established that family ownership weakens firm value with the availability of short-selling, which indicates that family businesses have long orientations and conduct better corporate governance practices than non-family business, as short-selling shows a weaker external governance effect on firm value creation by family businesses in China. A robust test of alternative measurements is conducted and validated. This study provides significant insights for policymakers to consider in order to further relax short-selling constraints, which can act as effective external governance for better firm value creation, especially for non-family businesses in developing countries.

scholarly journals The effectiveness of corporate governance in adhering to business ethics and social responsibility in family businesses to achieve sustainable development dimensions - A statistical reading of Algeria experience in the field of governance and business eth

2018 ◽  
Vol 2 (2) ◽  
pp. 104-136
Author(s):  
Mouhamed Said SAIDANI ◽  
Labidi MEHAOUAT ◽  
Ahmed BEKKAYE
Keyword(s):  
Corporate Governance ◽  
Business Ethics ◽  
Ethical Behavior ◽  
Family Businesses ◽  
Reporting Standards ◽  
Minority Shareholders ◽  
Goods Market ◽  
Ease Of Access ◽  
The Relationship

The study aimed at revealing thcve nature of the relationship between corporate governance and business ethics in family businesses in Algeria. In order to clarify the relationship, the aspects of impact were analyzed in 07 key areas: Protection of minority shareholders’ interests PMSI, Ethical behavior of firms EBF, Strength of auditing and reporting standards SARS, Efficiency enhancers  EE, Ethics and corruption CORR, Ease of access to loans EAL, Goods market efficiency GME, Using the statistical program SPSS 24 to study associative relationships and derive long-term dynamic relationships, the results showed a long-term balance between corporate governance and broader ethics In five key aspects: Protection of minority shareholders’ interests PMSI, Ethical behavior of firms EBF, Strength of auditing and reporting standards SARS, Efficiency enhancers  EE, Goods market efficiency GME, with no relationship between corporate governance and Ethics and corruption CORR, Ease of access to loans EAL, This leads us to say that there is a long-term dynamic balance between institutional governance and business ethics in family businesses in Algeria. The study therefore recommends further structural institutional reforms if any future governance or institutional effectiveness is to be achieved.

Effects of Family-to-Work Conflict on Business Owners

2011 ◽  
Vol 25 (2) ◽  
pp. 178-190 ◽  
Author(s):  
Ho Kwong Kwan ◽  
Victor P. Lau ◽  
Kevin Au
Keyword(s):  
Job Satisfaction ◽  
Social Networks ◽  
Family Business ◽  
Business Owners ◽  
Family Businesses ◽  
Business Research ◽  
Personal Lives ◽  
Chinese Business ◽  
Work Conflict ◽  
The Relationship

Family plays an important part in personal lives, career success, and organizational success. This study examines how type of businesses (family business vs. nonfamily business) moderates the relationships between family-to-work conflict (FWC) and job satisfaction and social networks. Results of a study on 158 Chinese business owners indicate that among nonfamily businesses, the relationship between owners’ FWC and job satisfaction is negative, whereas the relationship between their FWC and social networks is positive. Among family businesses, in comparison, owners’ FWC is not related to their job satisfaction and social networks. It is hoped that these findings will offer a springboard for future family business research.

scholarly journals Stepping into my shoes: generativity as a mediator of the relationship between business owners' age and family succession

2011 ◽  
Vol 32 (4) ◽  
pp. 673-696 ◽  
Author(s):  
HANNES ZACHER ◽  
ANTJE SCHMITT ◽  
MICHAEL M. GIELNIK
Keyword(s):  
Family Business ◽  
Positive Relationship ◽  
Objective Measure ◽  
Business Owners ◽  
Family Businesses ◽  
Next Generation ◽  
Social Construct ◽  
Succession In Family Business ◽  
The Relationship

ABSTRACTThe authors investigated generativity – the concern in establishing and guiding the next generation – as a mediator of the relationship between family business owners' age and succession in family businesses. Data came from 155 family business owners in Germany from different industries between the ages of 26 and 83 years. Results showed that age was positively related to generativity, and that generativity, in turn, positively influenced an objective measure of family succession. Generativity fully mediated the positive relationship between age and family succession. The findings suggest that generativity is an important psycho-social construct for understanding ageing, careers and succession in family business settings.

SET UP FOR GROWTH? — AN EXPLORATORY ANALYSIS OF THE RELATIONSHIP OF GROWTH INTENTION AND BUSINESS MODELS

2015 ◽  
Vol 19 (06) ◽  
pp. 1540009 ◽  
Author(s):  
SARAH MAHDJOUR
Keyword(s):  
Business Models ◽  
Theory Of The Firm ◽  
Past Research ◽  
Business Owners ◽  
Competitive Strategies ◽  
Consulting Services ◽  
And Performance ◽  
Set Up ◽  
Relationship Of ◽  
The Relationship

What do growth-oriented business models look like? While several economic theories, such as the theory of the firm, are based on the assumption that firms aim to maximise their profits, past research has shown that growth intention is heterogeneous among firms and that many business owners prefer to keep their firm at a size that they can manage with few resources. This paper explores the relationship of growth intention and business models, based on a sample of 135 German ICT businesses. Following an exploratory approach, Mann–Whitney U tests are applied to analyse how different business model designs correspond with different levels of growth intention. The results indicate that growth intention relates to business owners’ decisions regarding the provision of consulting services, the level of standardisation in offered products and services, the choice of addressed markets, the implementation of competitive strategies based on cost efficiency and of revenue streams based on one-time- and performance-based payments. Furthermore, the results show that growth oriented firms are no more likely than non-growth oriented firms to adapt their business models dynamically to changed internal or external conditions.

Family succession, professionalization and internationalization: a study of Brazilian family businesses

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Augusto Dalmoro Costa ◽  
Aurora Carneiro Zen ◽  
Everson dos Santos Spindler
Keyword(s):  
Family Business ◽  
Family Members ◽  
Secondary Data ◽  
Family Businesses ◽  
Three Dimensions ◽  
Content Type ◽  
The Family ◽  
Two Generations ◽  
Internationalization Strategies ◽  
The Relationship

PurposeThe purpose of this paper is to investigate the relationship between family succession, professionalization and internationalization in family businesses within the Brazilian context.Design/methodology/approachThe paper presents a multiple-case study method with three Brazilian family businesses that have at least two generations of the owning family involved in the business and an international presence of at least three years. In-depth interviews and secondary data were undertaken with family and non-family members of each case.FindingsThe authors' results show that a family business can boost its internationalization by introducing both succession planning and professionalization on international activities. As family members tend to be more risk-averse and focused on keeping the family business within the family, professionalization is a way of improving the firm's ability to expand internationally. This process tends to lead to lower performance by the firm for the first few months or the first year after the investment, but afterward, international performance tends to grow exponentially.Originality/valueOnly a few studies have been concerned on the relationship of these three dimensions. Thus, the research takes into account that professionalization and succession lead family businesses to improve their internationalization strategies.

Corporate governance, globalization and firm performance in emerging economies

2018 ◽  
Vol 67 (8) ◽  
pp. 1310-1333 ◽  
Author(s):  
Neha Saini ◽  
Monica Singhania
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Panel Data ◽  
Foreign Capital ◽  
Good Governance ◽  
Foreign Ownership ◽  
Foreign Firms ◽  
Content Type ◽  
Governance Practices ◽  
The Relationship

PurposeThe purpose of this paper is to examine relationship between corporate governance (CG) and firm performance for a set of 255 foreign-funded firms in the form of foreign direct investment (FDI) and private equity (PE). The authors employ a wide range of CG measures including board size, meetings, board gender and foreign ownership which are used as the proxy of globalisation and control variables like firm age, leverage, firm size and capital expenditure to arrive at a conclusion.Design/methodology/approachPanel data set of 255 (187 companies funded by foreign capital in the form of FDI, and 68 companies having foreign capital in the form PE) companies listed on Bombay Stock Exchange, for the period of eight years (2008–2015) are analysed by using static (fixed and random effects) and dynamic (generalised method of moments (GMM)) panel data specifications to examine the relationship among CG, globalisation and firm performance.FindingsThe empirical results of static model indicate the relationship between CG and performance of foreign firms, which are not very strong in India. This is due to the fact that most of the firms are not following the guidelines and regulations strictly in the initial period of sample years. Diversity in board is found as an important variable in accessing firm performance. And the authors also found that foreign firms are very particular about the implementation of CG norms. The results of GMM model highlight the interaction term of foreign ownership with governance indicators. CG is having a positive and significant impact over performance, inferring that higher foreign ownership (in the form of FDI and PE) in firm leading to positive effect on profitability.Practical implicationsThe investor’s preference of financing a unit is guided by the performance of a firm. Investors are more inclined towards high-performing firms, and hence higher profitability leads to higher inflow of capital. The result indicates that higher accounting and market performance may be achieved by good governance practices, in turn, leading to reduced agency costs. Countries with high governance scores attract more of foreign capital. Similar to the best governed countries, the companies having good governance practices attract more foreign inflows in the form of capital.Originality/valueWhile previous literature considered a single measurement framework in the form of a CG index, the authors tried to incorporate a range of CG indicators to study the effect of globalisation and CG on firm performance. The authors segregated foreign-owned funds into two parts, especially FDI and PE. This paper examined heterogeneity in the form of FDI-funded and PE-funded firms, as no prior literature is available which has evaluated different sets of foreign funds simultaneously on CG.

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