scholarly journals Contractual and relational family firm governance: Substitution or complementarity?

2010 ◽  
Vol 8 (1) ◽  
pp. 497-507 ◽  
Author(s):  
Virginia Bodolica ◽  
Martin Spraggon
Keyword(s):  
Corporate Governance ◽  
Conceptual Model ◽  
Family Firms ◽  
Family Firm ◽  
Boundary Theory ◽  
Substitution Effects ◽  
Governance Structures ◽  
Ongoing Debate ◽  
Governance Arrangements ◽  
Firm Governance

In this paper we argue that substantial weaknesses in corporate governance structures may be responsible for the pervasive failure of family firms to survive into the next generation. Aiming to improve extant knowledge on governance of family-owned enterprises that might boost their prosperity and longevity, we advance an integrative conceptual model which builds on boundary theory premises and accounts for the interdependencies among multiple governance arrangements. In particular, we suggest that the choice of an optimal governance configuration is dependent upon the way family firms manage the boundaries between their family and business identities. By combining contractual and relational devices of family firm governance into a single study, our model seeks to contribute to the ongoing debate in the literature regarding the existence of substitution effects and complementarity between alternative governance mechanisms.

scholarly journals Do families shape corporate governance structures?

2009 ◽  
Vol 15 (3) ◽  
pp. 327-345 ◽  
Author(s):  
María Sacristán Navarro ◽  
Silvia Gómez Ansón
Keyword(s):  
Corporate Governance ◽  
Empirical Evidence ◽  
Family Firms ◽  
Family Firm ◽  
Family Ownership ◽  
Governance Structures ◽  
Listed Firms ◽  
Board Committees ◽  
Spanish Family ◽  
Open Question

AbstractThis paper provides empirical evidence of family firm corporate governance structures, by examining a set of corporate governance characteristics of 132 non-financial Spanish listed firms. Results show that family firm boards present differential characteristics and that different patterns of family ownership configurations do not affect family firm corporate governance structures. We find that Spanish family firm boards are smaller than those in non-family firms. Family firm directors own a larger fraction of firm shares and have longer Chairman tenure than non-family firms, and family firms use fewer voluntary board committees – such as nomination and remuneration committees and executive committees. Besides, family firm boards and committees are biased towards insiders. Whether these differential characteristics affect other minority non-family shareholders negatively remains an open question.

scholarly journals Do families shape corporate governance structures?

2009 ◽  
Vol 15 (3) ◽  
pp. 327-345 ◽  
Author(s):  
María Sacristán Navarro ◽  
Silvia Gómez Ansón
Keyword(s):  
Corporate Governance ◽  
Empirical Evidence ◽  
Family Firms ◽  
Family Firm ◽  
Family Ownership ◽  
Governance Structures ◽  
Listed Firms ◽  
Board Committees ◽  
Spanish Family ◽  
Open Question

AbstractThis paper provides empirical evidence of family firm corporate governance structures, by examining a set of corporate governance characteristics of 132 non-financial Spanish listed firms. Results show that family firm boards present differential characteristics and that different patterns of family ownership configurations do not affect family firm corporate governance structures. We find that Spanish family firm boards are smaller than those in non-family firms. Family firm directors own a larger fraction of firm shares and have longer Chairman tenure than non-family firms, and family firms use fewer voluntary board committees – such as nomination and remuneration committees and executive committees. Besides, family firm boards and committees are biased towards insiders. Whether these differential characteristics affect other minority non-family shareholders negatively remains an open question.

Which Competitive Strategy Fits Better to Different Family-Business Profiles?

2022 ◽  
pp. 27-46
Author(s):  
Tomás F. González-Cruz ◽  
Norat Roig-Tierno
Keyword(s):  
Firm Performance ◽  
Family Business ◽  
Competitive Strategy ◽  
Family Firms ◽  
Qualitative Comparative Analysis ◽  
Family Firm ◽  
Tourism Industry ◽  
Environmental Turbulence ◽  
Configurational Approach ◽  
Governance Arrangements

This chapter belongs to the vein of research that analyses family firms from a configurational approach. This survey explores which combination of competitive strategy, environmental turbulence, family complexity, and family firm management and governance arrangements are present when firm performance is present. This research follows Le Breton-Miller and Miller's call to gain a better understanding of the interaction between competitive strategy, environmental conditions, and family firm features. Literature reports controversial results with regard to family-business strategic preferences and firm performance, and recent research shows that this relationship needs considering both industry and family context. This chapter analyses a sample of 129 Spanish SME-Family-Business that belong to the tourism industry. Using fuzzy-set qualitative comparative analysis, the authors find seven configurations to firm performance presence and one recipe for performance absence.

scholarly journals Principal-Principal Conflicts and Socioemotional Wealth in Family Firms

2017 ◽  
Vol 9 (10) ◽  
pp. 128 ◽  
Author(s):  
Jason See Toh Seong Kuan ◽  
Chin Fei Goh ◽  
Owee Kowang Tan ◽  
Norliza Mohd Salleh
Keyword(s):  
Corporate Governance ◽  
Family Firms ◽  
Family Firm ◽  
The Public ◽  
The Family ◽  
Different Types ◽  
Governance Practice ◽  
Corporate Governance Practice ◽  
The Relationship

Corporate governance is the concern of all the parties throughout the world regarding their viability in order to ensure the sustainability of the firm. As the family firms are listed in the public exchange, there are different kind of the investors in the corporation produce the resolution that are opposing to each other. Moreover, the large capital that is injected by the institutional investor complicates the role played in the corporation that shapes the culture and philanthropy. The phenomenon leads to the complex relationship in one corporation due to the different types of interest. Board composition and board independence are stretched by numerous scholars regarding the core importance in the corporation. Executive compensation is another area of corporate governance that is widely discussed by the scholars regarding the relationship with the long-term firm performance. Therefore, this review paper will focus on the application of the Principal-principal Conflicts theory and Socio-Emotional Wealth theory to narrate the whole scenario of the governance practice in the family firm. Throughout the paper, current rigorous practice of the family firms will be deeply investigated to cover the deep insights of the current phenomenon. The meticulous review of this paper is able to synthesize the significance of these theories towards the general governance setting in the family firms. Eventually, the working paradigm of the family firm can be clearly justified with the rationale that is justified. At the end of the review, the two main theories are concluded to be equally essential to illustrate the corporate governance practice in family firms across the globe.

scholarly journals Concept of Family Governance

2018 ◽  
Vol 48 (3) ◽  
pp. 61-68
Author(s):  
Jacek Lipiec
Keyword(s):  
Corporate Governance ◽  
Family Firms ◽  
Specific Interaction ◽  
Family Values ◽  
Family Firm ◽  
Family Governance ◽  
The Family ◽  
Similar Solutions

This article presents the concept of family governance based on the experience gained in the Roleski firm (the Constitution of Roleski family firm established in 2010) and the Łapaj firm (the Inheritance Statute of the Łapaj Group, 2011). The family governance has evolved from the corporate governance by taking into account the specific interaction of a family with a firm which manifests itself mainly in respecting family values. Based on experiences gained in both firms the process of building family governance was presented. It may be used by other family firms in implementing similar solutions that may help them to maintain the long-lasting development.

Which Competitive Strategy Fits Better to Different Family-Business Profiles?

2020 ◽  
pp. 127-146
Author(s):  
Tomás F. González-Cruz ◽  
Norat Roig-Tierno
Keyword(s):  
Firm Performance ◽  
Family Business ◽  
Competitive Strategy ◽  
Family Firms ◽  
Qualitative Comparative Analysis ◽  
Family Firm ◽  
Tourism Industry ◽  
Environmental Turbulence ◽  
Configurational Approach ◽  
Governance Arrangements

This chapter belongs to the vein of research that analyses family firms from a configurational approach. This survey explores which combination of competitive strategy, environmental turbulence, family complexity, and family firm management and governance arrangements are present when firm performance is present. This research follows Le Breton-Miller and Miller's call to gain a better understanding of the interaction between competitive strategy, environmental conditions, and family firm features. Literature reports controversial results with regard to family-business strategic preferences and firm performance, and recent research shows that this relationship needs considering both industry and family context. This chapter analyses a sample of 129 Spanish SME-Family-Business that belong to the tourism industry. Using fuzzy-set qualitative comparative analysis, the authors find seven configurations to firm performance presence and one recipe for performance absence.

When family firm corporate governance fails: the case of El Corte Inglés

2019 ◽  
Vol 10 (2) ◽  
pp. 97-115
Author(s):  
María Sacristán-Navarro ◽  
Laura Cabeza-García
Keyword(s):  
Corporate Governance ◽  
Family Firms ◽  
Family Members ◽  
Family Firm ◽  
Governance Mechanisms ◽  
Content Type ◽  
Theoretical Concepts ◽  
Corporate Governance Mechanisms ◽  
The Right ◽  
Practical Implications

Purpose The purpose of this paper is to describe internal corporate governance mechanisms in family firms as well as conflicts that may arise among shareholders and family members in the absence of specific corporate governance mechanisms. Design/methodology/approach After presenting theoretical concepts, the authors study the case of Spanish family firm El Corte Inglés to understand some of the corporate governance difficulties the company has experienced over the past few years. Findings This case illustrates how corporate governance problems can arise because the right mechanisms have not been used, leading to conflicts among family members, valuation problems and power struggles. Practical implications There is a need for family firms to employ suitable corporate governance mechanisms as governance complexity increases. Originality/value This study aims to contribute to the understanding of corporate governance problems among family members and their possible solutions.

Audit Characteristics, Gender Diversity and Firm Performance: Evidence from a Developing Economy

2021 ◽  
Vol 14 (1) ◽  
pp. 48-70
Author(s):  
Mohammad Rajon Meah ◽  
Kanon Kumar Sen ◽  
Md. Hossain Ali
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Audit Committee ◽  
Significant Contribution ◽  
Family Firms ◽  
Negative Impact ◽  
Interaction Analysis ◽  
Gender Diversity ◽  
Family Firm ◽  
The Impact

This study aims to explore the impact of audit characteristics and gender diversity on firm performance across family and non-family firms in Bangladesh. Using data of 61 non-family and 48 family firms from 2013 to 2019, this study applies system generalised method of moments approach to carry out regression analysis. Next, the consistency of results is detected by a full sample interaction analysis. In case of non-family firm, this study documents that Big4 audit firms (Big4) and female directors on board (FDR) have significant positive impact on firm performance. Conversely, audit meeting frequency (AMF) contributes negatively to the firm performance. Unfortunately, audit committee size (ACS) and audit committee independence (ACI) have no significant contribution on firm performance. In case of family firms, this study finds that ACS and ACI have significant negative impact on firm performance. Besides, Big4, AMF and FDR have no significant contribution on firm performance. It reflects that corporate governance mechanisms in family firm are not working well and even to some extent detrimental to the firm performance. It, ultimately, demands for reforms in corporate governance framework and incorporating new dimensions for family firms.

scholarly journals Efficacy of corporate social responsibility in corporate governance structures of family owned business groups in India

2018 ◽  
Vol 2 (1) ◽  
pp. 52-68 ◽  
Author(s):  
Raveena Naz
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Family Business ◽  
Family Firms ◽  
Business Groups ◽  
Business Group ◽  
Governance Structures ◽  
The Family ◽  
Corporate Social

The concept of ‘Corporate Social Responsibility’ (CSR) has often relied on firms thinking beyond their economic interest despite the larger debate of shareholder versus stakeholder interest. India gave legal recognition to CSR in the Companies Act, 2013. CSR in India is believed to be different for two reasons: the dominance of family business and the history of practice of social responsibility as a form of philanthropy (mainly among the family business). This paper problematises the actual structure of business houses in India and the role of CSR in a context where the law identifies each company as a separate business entity while the economics of institutions emphasizes the ‘business group’ consisting of a plethora of firms as the institutional organization of business where capital owned or controlled by the family group is spread across the firms through the interlocked holding structures. Within this framework, the largest family firms, which are part of family owned business groups, top the CSR expenditure list. The governance structure of family firms allows family owned business group to show mandatory compliance of CSR even when they actually spend much less than what is prescribed by law. This aspect of the family firms is not addressed by the CSR legislation in particular or corporate governance legislation in general in India. The paper illustrates this with an empirical study of one of the largest family owned business group in India Reliance Industries Limited (RIL), which is well acclaimed for its CSR activities. The paper demonstrates how the business group through these series of shareholding network reduces its legally mandated CSR liability. The paper thus indicates the inadequacy of CSR legislation in India because the unit of compliance is an individual firm and it assumes that each firm is independent and only connected to each other through market dealings. The law does not recognize the inter-connections of firms (through common ownership and control) in corporate governance structures of family owned business group and hence is inadequate in its design to effect the threshold level of CSR expenditure. This is the central argument of the paper.

A Four Factor Model: A Guide to Planning Next Generation Involvement in the Family Firm

1998 ◽  
Vol 11 (2) ◽  
pp. 135-142 ◽  
Author(s):  
Eleni T. Stavrou
Keyword(s):  
Conceptual Model ◽  
Family Business ◽  
Decision Process ◽  
Family Firms ◽  
Factor Model ◽  
Family Firm ◽  
Next Generation ◽  
Level Of Involvement ◽  
The Family

The involvement of and the reasons for the involvement of offspring in their parents' firms can significantly affect the firm's future. In this paper, a conceptual model is presented that explains the decision process through which the most suitable level of involvement for the next generation in the firm may be assessed. The decision process involves four factors: family, business, personal, and market. These factors set the context for managing intergenerational transitions in family firms.

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