Family-owned banks in Jordan: do they perform better?

PurposeFamily ownership is very common for Jordanian businesses, leading to a high level of involvement of family members in company management. There continues to be intense discussion on the pros and cons of family ownership, particularly as it focuses corporate control within a small family group. The purpose of this paper is to examine the performance of family- and non-family-owned banks that appear on the Amman Stock Exchange over the 2016 to 2020 period.Design/methodology/approachThe research on Jordanian domestic banks is based on data from the annual reports of banks listed on their websites which offers comprehensive data on finances, ownership and the board. Family-owned and non-family banks were analysed using multiple regression technique to identify any variations in their performance.FindingsUsing a sample of 16 domestic banks with 75 bank-year observations over the 2016 to 2020 period, the study supports other research in finding that family ownership is negatively related to bank performance. This is true for accounting-based and market-based performance measures, including return on assets (ROA), return on equity (ROE) and Tobin's Q test results. Additionally, analysis identifies greater negative consequences for performance within family-owned banks by board of directors.Originality/valueThis paper extends previous research on family businesses by investigating the impact of family ownership on the financial performance in the Jordanian bank sector. This research determined that devaluation is a consequence of higher levels of ownership concentration for domestic banks in Jordan.

Exploring the life cycle of family-owned tourism businesses in maturity

PurposeThe aim of this paper is to analyze the life cycle of family-owned hotels in the maturity phase from the integration of theoretical models for family-owned tourism businesses.Design/methodology/approachA qualitative multiple case study was used to analyze four mature family-owned hotels through eight interviews and four observation guides with an abductive method. Three axes were analyzed; the ownership with the Gersick model, the family with the Tobak and Nábradí model and the business with the Butler tourist areas model to identify whether they are going through the consolidation stage, stagnation, rejuvenation or decline within its maturity.FindingsThe cases studied evolve in the three axes. In the business axes, two go through the stagnation stage, another in decline and the last in consolidation; all remain under controlling owners. In the family, there are different generations in charge. The boost to the destination plays a key role as a force for deterministic change in the internal transformation of these organizations, and to remain in consolidation, discontinuous changes and voluntaristic actions are necessary.Originality/valueFamily businesses seek longevity, although a low percentage reaches maturity. This research proposes the integration of life cycle models to understand its development in the axes of family, ownership and business, where aspects of the tourism industry are considered and allow the stage identification through which it passes in maturity, supporting internal decision making.

Cash Holdings and Corporate Governance

This chapter investigates the empirical factors affecting corporate cash holdings with special emphasis on corporate governance variables for a sample of Turkish-listed nonfinancial firms over the period 2006 to 2010. The findings reveal a significant non-linear relation between family ownership and cash holdings. In addition, while board structure does not significantly affect the level of cash holdings, tunneling increases cash reserves of firms. Furthermore, the results indicate that cash flow, leverage, other liquid assets that can be used as cash substitutes, the degree of tangibility of assets, and firm size are important in determining cash holdings among Turkish companies.

The Role of Family Ownership in Survival and Bouncing Back

The latest global economic and financial crisis has been a litmus test for companies, especially for SMEs. These companies have had to demonstrate their ability to be resilient, surviving first and then recovering. This chapter studies the role of family ownership in the survival and recovery of SMEs during a stressful event. From a perspective based on the complementarity or substitutability of goals that family firms pursue, the authors propose that family ownership has a positive effect on survival but a negative effect on recovery. Furthermore, they propose that the risk of bankruptcy before a crisis moderates the relationship between family ownership and survival. Hypotheses have been tested with a dataset of 3,133 Spanish manufacturing MEs finding evidence for the positive role of family ownership in survival and for the moderating effect of previous bankruptcy risk. The empirical data confirms good news for family-owned firms.

Analisis Karakteristik Dewan Direksi dan Struktur Kepemilikan terhadap Manajemen Laba Perusahaan di BEI 2016-2020

This study aims to investigate the influence of women's boards of directors on earnings management. The dependent variable in this study is earnings management using the Discretionary Accruals measurement method with the Modified Jones Model. The independent variables used are women board of directors, board size, board independence, audit quality, family ownership, blockholder ownership, leverage, Return on Assets (ROA), and firm size. This study used a data sample of 381 companies with the period of 2016 to 2019 with a purposive sampling method. The research data tested by panel regression testing using Eviews and SPSS application. The results of this study are women board of directors, board size, board independence, audit quality, family ownership, blockholder ownership, and firm size do not have a significant effect on earnings management. Meanwhile, leverage has a significant negative effect on earnings management and Return on Assets (ROA) has a significant positive effect on earnings management.