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Family Business
Family Business Guido Corbetta, Bocconi University, Milan, Italy Ó 2015 Elsevier Ltd. All rights reserved.
Abstract Family business is an interdisciplinary field devoted to study the structural and transitional problems of family firms. Family firms can be defined as companies of various sizes controlled by one or more owners tied by family relationship or solid alliances. The recent important theoretical and empirical developments have crystallized a double-edged vision of the family firm, which includes both the positives and the negatives of family control descending. Future studies should propose research designs that take into account the need to go beyond simple – although powerful – variables such as family ownership and leadership. As in most of the managerial fields, the simultaneous search for rigor and relevance should dominate the scholarly agenda over the next few years.
Family business is an interdisciplinary field, born as an autonomous one only in the early 1980s, involving all professionals who advise, study, and work in family firms addressing their structural and transitional problems. Family firms are dynamic systems including two subsets, the family and the firm. Traditionally, family firms have been considered as a residual of the past that inhibits the development of more efficient ‘managerial’ firms with dispersed shareholding. However, different factors have persuaded individuals and institutions to work on them in research and practice: high and persisting relevance in modern economies, evidence that family firms are able to grow up to very large sizes, and the need to support them to overcome the difficulties to go beyond the first generation. Today, there are 57 endowed Chairs in Family Business mostly in the United States and Europe. Family firms can be defined as companies of various sizes controlled by one or more owners tied by family relationship or solid alliances (see Corbetta and Salvato, 2012). Despite this general tenet, there are different possible definitions of the family firm. Westhead and Cowling (1998), for instance, were among the first to notice how previous research relied on alternative views about what the family firm is. Such definitions were based on (1) the entrepreneur perception of being a family firm, (2) the family ownership, (3) the family management, and (4) the intergenerational ownership transition (Westhead and Cowling, 1998). Chua et al. (1999) noticed how different researchers use varying definitions of family involvement (in the ownership, in the business, or both) to qualify a family firm, and hence proposed an alternative theoretical definition based on the differential characteristics of family firms vis-à-vis the others. More precisely, they define the family firm as “a business governed and/or managed with the intention to shape and pursue the vision of the business held by a dominant coalition controlled by members of the same family or a small number of families in a manner that is potentially sustainable across generations of the family or families” (Chua et al., 1999: 25). The same scholars in a later study further enucleate the four distinguishing points of the family business definition, which are (1) the intention to maintain family control by the dominant coalition, (2) a set of
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resources and capabilities arising from family involvement and interactions among family actors, (3) a vision set by the family controlling the firm, and (4) the pursuance of such vision. Along the same line, Astrachan et al. (2002) proposed an index of family involvement called FamilyPower, Experience, and Culture (F-PEC), which enables the assessment of family influence on a continuous scale rather than restrict its use to categorical variables (yes/no), and allows comparisons across businesses concerning levels of family involvement, and its effects on performance as well as other business behaviors. While most of the empirical research refers to family ownership, ownership-based definitions adopted in different studies are largely dependent upon size and other firm characteristics, as well as upon the institutional context. For instance, while Anderson and Reeb (2004) in their study of large US firms used family control thresholds ranging from 5 to 10%, other studies relied on a considerably larger threshold of 50% of shares for private, reduced to 30 or 25% for listed firms (e.g., Minichilli et al., 2010). The relevance of family business has recently been recognized also by important institutions such as the European Commission, which set a Family Business Group to discuss and research on family firms in individual countries, and the critical issues they face. One of the most important outcomes of the activity of this group has been to come up with a definition, included in the 2009 Report of the EU Commission. According to this definition, “A firm, of any size, is a family enterprise if: 1. The majority of votes is in possession of the natural person(s) who established the firm, or in possession of the natural person(s) who has/have acquired the share capital of the firm, or in possession of their spouses, parents, child, or children’s direct heirs. 2. The majority of votes may be indirect or direct. 3. At least one representative of the family or kin is involved in the management or administration of the firm.” This definition also applies to listed companies that meet the definition of family enterprise if the person(s) who established or acquired the firm (share capital) or their families or descendants possess 25% of the right to vote mandated by their share capital (EU Commission, Report, 2009). This was the first time that an official, high-level body adopted a definition of the family firm in order to establish a framework for successive
International Encyclopedia of the Social & Behavioral Sciences, 2nd edition, Volume 8
http://dx.doi.org/10.1016/B978-0-08-097086-8.73001-7
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and empirical developments that can be summarized as follows: 1. The definition of the main dynamic relationships between family and business using interpretative frameworks based on different stages of the firms, people, and families’ life cycles. Along this line, Miller and Le Breton-Miller (2005) identified four elements that should secure the family businesses’ success in the long run. They are (1) continuity, that is, the will of family firms to constantly and passionately realize their mission; (2) community, achieved through a cohesive team of employees united by strong values; (3) connections, since relationships with partners vastly exceed the time span and scope of ordinary market transactions; and (4) command, since family business decision makers are able to act independently, rapidly, and without rigid restrictions from shareholders; 2. A more in-depth (and insightful) approach to family business successions, admitting complex situations characterized by multiple family and nonfamily leadership candidates, and subsequently stating the importance to base the successor’s selection on specific criteria such as motivation, managerial abilities, career development, outside work experience, formal education, training programs, etc.; 3. A closer attention to the differences between different types of family firms, going beyond the traditional overlap with small- and medium-sized enterprises. Along this line, Corbetta proposed four archetypes of family firms corresponding to different sizes and ownership concentration levels, and also showing typical evolutional patterns from one stage to another. Consistent to this, recent studies are increasingly arguing for the importance of sampling issues, both in terms of firm size and family ownership concentration, to influence actual research results (e.g., Miller, 2013); 4. A theoretical and empirical quest to understand the direct family ownership effects on firm behavior and performance, leading to conceptualize both the negative sides due to increasing agency costs related to problems of altruism and self-control (Schulze et al., 2001), as well as the positive sides of ‘distinctive familiness,’ which can lead to familybased advantages and transgenerational wealth creation (Habbershon et al., 2003). Despite the long-lasting search, however, a recent large-scale meta-analysis showed that on average family ownership has either no effect or at best offers a small performance advantage relative to other types of ownership. 5. A stronger focus on formal aspects of family governance and leadership, including the functioning of boards of directors (Anderson and Reeb, 2004), but mostly the effect of family leadership on firm performance (Anderson and Reeb, 2004; Minichilli et al., 2010). While most of these studies report a positive effect of family leadership, others raise the importance to contextualize these results within specific family firm ‘types’ or ‘configurations’ (Miller et al., 2013). 6. The importance of recognizing different levels of analysis in family business research, going beyond the importance of individuals and individual leaders, but also considering (1) interpersonal or group-level relations (e.g., between different groups of family and nonfamily employees and
managers); (2) organizational level, pointing out five different sources of capital such as human, social, survivability, patient capital, and family governance structures; and (3) the role of family firms in society and at a societal level (Sharma, 2004); 7. The distinctive behavior of family firms, with respect to emotions, exploring various constructs such as emotional capital, emotional ownership, emotional returns and costs, and emotional value. These ideas have been recently conceptualized in the socioemotional wealth (SEW) approach in studying family business (Gomez-Mejia et al., 2011); 8. The influence of emotions and distinctive family (economic and noneconomic) goals on strategic objectives and decisions in family firms. According to Chrisman et al. (2005), family firms show relevant specificities in terms of (1) strategic objectives, which go beyond profit maximization and include set nonfinancial goals such as family satisfaction and sustainability of the business across the family’s lifetime; (2) strategic choices, which include also quality and long-term relationships with suppliers, customers, and local communities; and (3) strategic processes, which tend to be based on trust mechanisms, cohesion, and a value-driven business orientation made possible by higher levels of goal alignment between owners and managers; 9. The subsequent strategic alternatives available to family firms, providing insights on the business or corporate strategies used by family firms to exploit their unique resources and capabilities. As such, various studies considered the relationship between family involvement in the business and choices such as diversification, acquisitions, corporate social responsibility, and financing choices, among others. These important theoretical and empirical developments have crystallized a double-edged vision of the family firm, which includes both the positives and the negatives of family control descending from the previous considerations, also characterized as the ‘bright’ and the ‘dark’ side of family involvement in business (Minichilli et al., 2010). According to a recent review, the positive aspects include (Gomez-Mejia et al., 2011) the following: l l l
l l
Patient capital that values long-term returns over short-term gains; Affective commitment of owners, managers, and employees; A culture that fosters employee identification with the organization and lower employee turnover, thereby ensuring continuity and the capacity to pursue long-term projects; Accumulation of social capital, which becomes a ‘moral resource’; Continuity of leadership, offering greater resilience in hard times and faster decision making.
These aspects turn into negative aspects of the family when one (or more) of the following phenomena occur (GomezMejia et al., 2011): l
Appropriation of firm resources to satisfy parochial family desires;
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Nepotism, cronyism, and incompetent family members on the payroll; l Excessive effort expended on family emotions and conflict, which distract from paying attention to market forces and business matters; l The ‘spoiled kid syndrome,’ which can create feelings of inequity among employees; l Parental altruism, overuse of business perks, and biased hiring decisions. The intellectual curiosity to further explore the pros and cons of family involvement in business in different types of firms, as well as in different contexts, resulted in a growing number and quality of scientific articles both in field and in top-tier generalist journals. This is witnessed by the impact factor (IF) trend of the field journal (FBR), which obtained the first IF in 2007 (equal to 0.67), growing up to 2.42 in 2010, at comparable levels of more established management journals. At the same time, the interest in the topic has been marked by a wealth of articles published in journal special issues. Among the most recent experiences, Schulze and Gedajlovic edited in 2010 a special issue for the Journal of Management Studies entitled ‘The family and enterprise: Unpacking the connections,’ and exploring a number of emerging issues in family business research such as the impact of top management teams’ composition and diversity on performance, the diversification decisions in family-controlled firms, or the effect of family control and ownership in different institutional settings. Interestingly, then, Steir, Lumpkin, and Wright edited in 2011 a further special issue in the Strategic Entrepreneurship Journal entitled ‘Strategic Entrepreneurship in Family Business,’ in which they discuss the ways in which the influence of family matters to strategic entrepreneurship, and how strategic entrepreneurship can contribute to understanding and strengthening of family firms, discussing concepts such as entrepreneurial orientation and portfolio entrepreneurship in family firms, mostly in a resource-based framework. Finally, the interest in family business research has overcome in the past decade the boundaries of management research, with a growing number of contributions from influential scholars from the fields of economics, finance, and even sociology. Economists for the most part have tended to focus on questions relating to the governance of the family firm and its influence within the global economy (La Porta et al., 1999), focusing on the variety of mechanisms that family-controlled firms use to enhance their power, while finance-oriented scholars mostly concentrated attention on the role of family managers’ style on firm performance, as well as the impact of family and nonfamily CEOs’ succession (Bennedsen et al., 2007).
From the Present to the Future of Family Business Studies The Theoretical Arena A first important element to identify future directions of development for the field relates to the theoretical arena, which today characterizes family business studies. Despite the impressive number of published conceptual articles, indeed, it
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seems that family business scholars mostly used established theories, applying them to family firms for the purpose of understanding and explaining their uniqueness. According to agency theory (Jensen and Meckling, 1976; Schulze et al., 2001), one of the common assumptions of economic-based investigations of family firms is that they are believed to lower agency costs due to the alignment of interests between owners and agents. Nevertheless, recent interpretations and substantive works by Bill Schulze and colleagues emphasized the negative aspects of close alignment between owners and agents, and highlighted the risk of the so-called parental altruism,’ that is, the tendency of parents to attribute benefits to family members (e.g., higher compensation, consumption of perks, and generous or ‘familial’ appointments), in general, serving all the specific interests of the family. The ‘failure’ of the agency theory to satisfactorily explain the family executive’s behaviors led scholars to rely more on psychological aspects of human beings to support evidences from family business studies, such as the stewardship theory (Corbetta and Salvato, 2004). According to the stewardship theory, in serving their corporations, family executives are driven by both economic and noneconomic rationales, and experience satisfaction from the ability to share, help, and support other cherished family members in the process. They are also motivated by a need to gain intrinsic satisfaction through effectively performing exigent work, and thereby to gain recognition from peers and superiors. This contributes to these managers’ sense of identity and self-esteem deriving by identification with their company and their fulfillment of family obligations. The growth in rigor, relevance, and width of family business studies over years progressively attracted attention from strategy scholars, with the natural consequence of crossfertilization among studies and theories. One of the most notable results has been the rise of the resource-based view (RBV) (Barney, 1991) as a theoretical lens to identify resources and capabilities that are unique, scarce, valuable, hardly imitable, and with significant rent potentials within family firms. Under this view, family involvement (so-called familiness) contributes to the building up of competitive advantage over ‘faceless’ competitors for the firm through higher stocks of social capital and ‘patient’ financial resources that enhance the firm’s economic sustainability and longevity (Miller and Le Breton-Miller, 2005). These resources can also contribute indirectly to firm performance through the achievement of outcomes such as the preservation of family ties and transgenerational value creation (Sharma, 2004). Nevertheless, the inability of the agency, stewardship, and RBV to univocally predict the positive or negative side of family businesses led a number of scholars to propose novel interpretative theoretical lenses to investigate family business phenomena. On the one hand, some studies tried to combine agency and stewardship predictions in order to reconcile predictions stemming from the economic and psychological rationales that characterize, respectively, those two theories. As a result, many other studies suggest that family involvement is an unambiguously positive or negative influence, whereas the interpretive framework proposed by these scholars significantly conditions both those expectations. The underlying thesis here is that both
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these well-argued views of family business may hold, but under different circumstances, largely characterized by the degree to which a business and its top executives are embedded within a family. On the other hand, another group of scholars tried to introduce a new paradigm in the family business field, which again combines psychological and economic rationales in family firms’ decision making, but using the preservation of the ‘socioemotional endowment’ of a family as the economic reference point for strategic decisions. Introduced by GomezMejia et al. (2011) as a variant of the behavioral agency model, the SEW perspective refers to nonfinancial aspects of the firm that meet the family’s affective needs, such as identity, the ability to exercise family influence, and the perpetuation of the family dynasty. Based on the assumption that family firms may give priority to socioeconomic rather than purely economic rationales, the preservation of SEW is a crucial feature of family firms. The SEW perspective has recently been used in the context of family firms to explain their uniqueness with regard to a range of topics, such as managerial entrenchment or executive compensation. The general conclusion from this research is that controlling family owners tend to be guided by a set of motives different from those for other types of owners.
Theory Building or Theory Testing: Rigor and Relevance The theoretical prolificacy represents one of the distinctive features of the family business field, as well as one of its potentially problematic issues. Searching for a unique (and unifying) conceptual framework to understand family firms’ characteristics and behavior, scholars have traditionally attempted to propose new concepts, ideas, and framework, with the result that empirical testing of newly elaborated constructs has been often downplayed. Among recent studies published in the FBR, for instance, constructs and related propositions on family emotions, family social capital, and knowledge integration have been proposed, but not tested yet. This evidence parallels calls from the SEW growing literature: despite SEW being so far used as an interpretative framework to explain outcome variables, few or no studies actually measured the socioemotional dimension of families, and the challenge to measure SEW is definitely next. This impression is confirmed in a recent work (Tognazzo, 2012), which considers 279 articles published in the FBR from 1998 to 2010, for the purpose of distinguishing between theory building (introducing new constructs, new relationships, or variables) and theory testing (test hypothesis on the bases of previous theories using large samples). Interestingly, trends of theory building and testing in FBR are stable over the past decade, with theory building dominating over theory testing, exactly the opposite of what the author found in more traditional journals such as the Academy of Management Journal, Administrative Science Quarterly, and Strategic Management Journal, in which theory testing instead dominates. At the same time, however, the relevance for practice, which traditionally characterized FBR articles, significantly dropped in the past decade, with the article practical relevance score halved during the period considered for the analysis. It confirms a tendency toward a proliferation
of new constructs and relationships, at the expense of more ‘rigorous’ tests of established paradigms on large samples, also in order to gain legitimacy in the field, as well as of ‘relevant’ research with practical implications. As in most of the managerial fields, the simultaneous search for rigor and relevance should dominate the scholarly agenda over the next few years.
Some Insights on the Next Developments in the Family Business Field Drivers of Development A recent survey of 80 family business scholars by Litz et al. (2012) about the state of the art and future developments of the field supports the above insights and considerations. Specifically, the authors contend how, although the field has achieved a substantial consensus, this consensus is at best of a penultimate nature (Litz et al., 2012). In other terms, the impressive growth experienced by the family business field in the past two decades has potential downsides that inhibit proper consensus. On the one hand, the fast rise in numbers of doctoral students and scholars interested in the topic determined a scattered growth characterized by spotty referencing and fragmented views of the field, casting doubts about whether this quantitative growth has always been accompanied by a qualitative development; consequently, while there is definite consensus that questions relating to family business are important, there is much less consensus as to the answers (Litz et al., 2012). This lack of consensus is mirrored by additional insights stemming from the survey. As the authors effectively summarize, “the field will need to develop and innovate by expanding its conceptual boundaries to mode deliberately include the family, enlarge its temporal boundaries to more reflectively appreciate the past, open its international boundaries to welcome findings from a growing array of international and ethnic contexts, and enrich its inherent complexity to appreciate works that present novel variables and engage in increasingly diverse set of topics” (Litz et al., 2012, p. 30). In addition to consensus, a second important driver of development might be an increasing reliance on an interdisciplinary approach to the field. In terms of necessary competencies, many family business scholars believe that most research topics need interdisciplinary team effort; in particular, researchers in different branches of management, psychology, and sociology should cooperate to capture the distinctive facets of family business. For instance, organizational behavior and social psychology can help one to better understand the role of emotions in these firms, finance can contribute in helping one to understand the constraining role of capital and financial markets on future growth, and sociology can help one to unravel the influence of institutional pressures and family networks on firm survival (Gomez-Mejia et al., 2011). The reason why interdisciplinary collaboration is not well developed is most likely because of the high costs of joint research due to the very different starting points in terms of knowledge, languages, and methodologies. Nevertheless, since in many fields radical advances come from collaboration between authors in different disciplines and professions, such collaboration should be strongly encouraged.
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Relevant Topics and Methodological Challenges In terms of content, the future development of the field will be characterized by a number of relevant issues, as well as by important methodological challenges. On the one hand, companies’ strategic context is significantly changing because of the impact of new technologies and globalization, as well as the impact of the economic crisis that started in 2008. As such, the family businesses’ capability to compete in such a context will represent a relevant research topic. Another key issue will be the impact of increasing managerial and financial sophistication on the culture and behavior of family businesses, as well as the responses of family firms to increasing institutionalization of their governance forms. This is evident in the recent development of codes of good governance for private firms (Buysse Code in Belgium; EcoDa Recommendations; Institute of Directors’ Code in the United Kingdom), and specifically for family firms (IFC Family Business Governance Handbook – World Bank; Governance für Familienunternehmen in Switzerland; Guía Colombiana de Gobierno Corporativo para Sociedades Cerradas y de Familia in Colombia). This is also related to what Chrisman et al. (2010) propose in their review and research agenda. According to these scholars, three important emerging issues in the family business research are (1) family governance systems, devoting more attention to monitoring mechanisms, informal family system versus formal ones, boards of directors in family enterprises, with the need to investigate further their composition, functioning, and performance; (2) owner–owner agency costs, investigating situations in which controlling owners may extract benefits from the firm at the expense of minority owners; and (3) noneconomic goals, which include how the pursuit of noneconomic goals can provide competitive advantage or, on the contrary, more conservative behaviors (Chrisman et al., 2010). Finally, empirical evidence from the first four editions of the annual Italian Observatory on medium and large familycontrolled firms (in collaboration with AIdAF, The Italian Association of Family Firms, Unicredit Bank, and the Chamber of Commerce of Milan) suggest additional research topics for the near future. Consistent also with the theoretical review above, these topics include the following: (1) Family firms’ heterogeneity, which should stress the importance of critical dimensions such as firm size, ownership concentration, generation in command, and family pervasiveness at different leadership levels. The adoption of a configurational approach would be of help to reassess all the traditional issues of family business investigation (including the effects of governance, leadership, succession, strategy, and performance) into specific configurations or ‘types’ of family firms. (2) Leadership (or coleadership) models: the limited attention to coleadership is surprising in light of the importance of coleadership in family firms from a conceptual standpoint, as well as in terms of magnitude of the phenomenon. Conceptually, family business literature indicated coleadership as a leadership model particularly suited for family firms at different stages of the firm development and/or generations. Coleadership may occur among cofounders, with parents, brothers, or cousins, who share the responsibility to lead
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a new venture. (3) Multilevel analyses: most family business studies followed the tendency in the broader strategic management literature to investigate the impact of managerial characteristics on firm outcomes, and this tendency has been replicated in the family business field. Nevertheless, the intrinsic interplay among actors (family and nonfamily) within family firms, and the sophistication of analytical techniques and new statistical tools allow now for the possibility of further delving into this, and more attention to multilevel investigations should be devoted. (4) Family firms’ behaviors: future research may benefit from considering more in-depth behaviors of family firms and family actors. Again, behaviors can be effectively investigated in different types of family firms, and include entrepreneurship (in smaller firms), corporate social responsibility, or stakeholder attention, as well as more strategic issues such as adaptability and responses to changing environments. On the other hand, proper investigation of these issues open important methodological challenges. First, the vast majority of existing studies relied on a rather limited set of variables, including family control and family leadership mostly. Despite the challenge posed by measurement issues, future studies should propose research designs that take into account the need to go beyond simple – although powerful – variables such as family ownership and leadership. The more accurate test of constructs related to behaviors of various family and nonfamily actors inside family firms would also be of extreme help to solve some of the theoretical tensions between economic- or psychological-based theories discussed above, and to allow a better investigation of family firms’ and family actors’ behaviors. At the same time, however, the will to more deeply investigate family businesses raise concerns on information availability. Entrepreneurs and their families are known to be very reserved and protective of their privacy. Moreover, most family businesses do not have to disclose much information about their structure or about their performances. Researchers are trying to overcome this problem by collaborating with institutions such as banks that can provide family business databases or by designing research projects based on primary sources and making use of interviews, questionnaires, and longitudinal case studies. Sponsorship will also be essential for this purpose: the strong link with family businesses and institutions will be more and more helpful in making the relationship between theory and practice mutually beneficial, and to fund large, cross-country databases. Obviously scholars should avoid focusing on short-term needs and commit themselves to identifying long-term research goals and strategies.
See also: Bourgeoisie and Middle Classes, History of; Entrepreneurship and Organizations; Ethnicity and Ethnic Groups: Historical Aspects; Family as Institution.
Bibliography Anderson, R.C., Reeb, D.M., 2004. Board composition: balancing family influence in S&P 500 firms. Administrative Science Quarterly 49, 209–237.
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Astrachan, J.H., Klein, S.B., Smyrnios, K.X., 2002. The F-PEC scale of family influence: a proposal for solving the family business definition problem. Family Business Review 15 (1), 45–58. Barney, J., 1991. Firm resources and sustained competitive advantage. Journal of Management 17 (1), 99–120. Bennedsen, M., Nielsen, K., Perez-Gonzalez, F., Wolfenzon, D., 2007. Inside the family firm: the role of families in succession decisions and performance. The Quarterly Journal of Economics 122, 647–691. Berle, A.A., Means, G.C., 1932. The Modern Corporation and Private Property. Macmillan, New York. Chrisman, J.J., Chua, J.H., Sharma, P., 2005. Trends and directions in the development of a strategic management theory of the family firm. Entrepreneurship Theory and Practice 29 (5), 555–575. Chrisman, J.J., Kellermanns, F.W., Chan, K.C., Liano, K., 2010. Intellectual foundations of current research in family business: an identification and review of 25 influential articles. Family Business Review 23 (1), 9–26. Chua, J.H., Chrisman, J.J., Sharma, P., 1999. Defining the family business by behaviour. Entrepreneurship Theory and Practice 23 (4), 19–39. Corbetta, G., Salvato, C., 2012. Strategies for Longevity in Family Firms: A European Perspective. Palgrave MacMillan, Basingstoke, UK. Corbetta, G., Salvato, C., 2004. Self-serving or self-actualizing? Models of man and agency costs in different types of family firms: a commentary on “comparing the agency costs of family and non-family firms: conceptual issues and exploratory evidence”. Entrepreneurship Theory and Practice 28 (4), 355–362. Gomez-Mejia, L.R., Cruz, C., Berrone, P., De Castro, J., 2011. The bind that ties: socioemotional wealth preservation in family firms. Academy of Management Annals 5, 653–707. Habbershon, T.G., Williams, M.L., MacMillan, I., 2003. A unified systems perspective of family firm performance. Journal of Business Venturing 18 (4), 451–465. Jensen, M.C., Meckling, W.H., 1976. Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics 3, 305–360. La Porta, R., Lopez-de-Silanes, F., Shleifer, A., 1999. Corporate ownership around the world. Journal of Finance 54 (2), 471–517.
Litz, R.A., Pearson, A., Litchfield, S., 2012. Charting the future of family business research: perspectives from the field. Family Business Review 25 (1), 5–15. Miller, D., Le Breton-Miller, I., 2005. Managing for the Long Run. Lessons in Competitive Advantage from Great Family Businesses. Harvard Business School Press, Boston, MA. Miller, D., Minichilli, A., Corbetta, G., 2013. Is family leadership always beneficial? Strategic Management Journal 34 (5), 553–571. Minichilli, A., Corbetta, G., MacMillan, I., 2010. Top management teams in family controlled companies: ‘familiness’, ‘faultlines’ and the impact on financial performance. Journal of Management Studies 47 (2), 205–222. Schulze, W.S., Gedajlovic, E., 2010. Whiter family business. Journal of Management Studies 27, 1919–204. Schulze, W.S., Lubatkin, M.H., Dino, R.N., Buchholtz, A.K., 2001. Agency relationships in family firms: theory and evidence. Organization Science 12, 99–116. Sharma, P., 2004. An overview of the field of family business studies: current status and directions for the future. Family Business Review 17, 1–36. Tognazzo, A., 2012. Entrepreneurship and Performance in Family SMEs: From Theoretical Models to a Competency Approach. PhD Thesis. Università di Padova. Westhead, P., Cowling, M., 1998. Family firm research: the need for a methodological rethink. Entrepreneurship Theory and Practice 23 (1), 31–56.
Relevant Websites www.fbn-i.org – Family Business Network. fbr.sagepub.com – Family Business Review. www.ffi.org – Family Firm Institute. www.ifera.org – International Family Enterprise Research Academy.
Abstract Family business is an interdisciplinary field devoted to study the structural and transitional problems of family firms. Family firms can be defined as companies of various sizes controlled by one or more owners tied by family relationship or solid alliances. The recent important theoretical and empirical developments have crystallized a double-edged vision of the family firm, which includes both the positives and the negatives of family control descending. Future studies should propose research designs that take into account the need to go beyond simple – although powerful – variables such as family ownership and leadership. As in most of the managerial fields, the simultaneous search for rigor and relevance should dominate the scholarly agenda over the next few years.
Family business is an interdisciplinary field, born as an autonomous one only in the early 1980s, involving all professionals who advise, study, and work in family firms addressing their structural and transitional problems. Family firms are dynamic systems including two subsets, the family and the firm. Traditionally, family firms have been considered as a residual of the past that inhibits the development of more efficient ‘managerial’ firms with dispersed shareholding. However, different factors have persuaded individuals and institutions to work on them in research and practice: high and persisting relevance in modern economies, evidence that family firms are able to grow up to very large sizes, and the need to support them to overcome the difficulties to go beyond the first generation. Today, there are 57 endowed Chairs in Family Business mostly in the United States and Europe. Family firms can be defined as companies of various sizes controlled by one or more owners tied by family relationship or solid alliances (see Corbetta and Salvato, 2012). Despite this general tenet, there are different possible definitions of the family firm. Westhead and Cowling (1998), for instance, were among the first to notice how previous research relied on alternative views about what the family firm is. Such definitions were based on (1) the entrepreneur perception of being a family firm, (2) the family ownership, (3) the family management, and (4) the intergenerational ownership transition (Westhead and Cowling, 1998). Chua et al. (1999) noticed how different researchers use varying definitions of family involvement (in the ownership, in the business, or both) to qualify a family firm, and hence proposed an alternative theoretical definition based on the differential characteristics of family firms vis-à-vis the others. More precisely, they define the family firm as “a business governed and/or managed with the intention to shape and pursue the vision of the business held by a dominant coalition controlled by members of the same family or a small number of families in a manner that is potentially sustainable across generations of the family or families” (Chua et al., 1999: 25). The same scholars in a later study further enucleate the four distinguishing points of the family business definition, which are (1) the intention to maintain family control by the dominant coalition, (2) a set of
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resources and capabilities arising from family involvement and interactions among family actors, (3) a vision set by the family controlling the firm, and (4) the pursuance of such vision. Along the same line, Astrachan et al. (2002) proposed an index of family involvement called FamilyPower, Experience, and Culture (F-PEC), which enables the assessment of family influence on a continuous scale rather than restrict its use to categorical variables (yes/no), and allows comparisons across businesses concerning levels of family involvement, and its effects on performance as well as other business behaviors. While most of the empirical research refers to family ownership, ownership-based definitions adopted in different studies are largely dependent upon size and other firm characteristics, as well as upon the institutional context. For instance, while Anderson and Reeb (2004) in their study of large US firms used family control thresholds ranging from 5 to 10%, other studies relied on a considerably larger threshold of 50% of shares for private, reduced to 30 or 25% for listed firms (e.g., Minichilli et al., 2010). The relevance of family business has recently been recognized also by important institutions such as the European Commission, which set a Family Business Group to discuss and research on family firms in individual countries, and the critical issues they face. One of the most important outcomes of the activity of this group has been to come up with a definition, included in the 2009 Report of the EU Commission. According to this definition, “A firm, of any size, is a family enterprise if: 1. The majority of votes is in possession of the natural person(s) who established the firm, or in possession of the natural person(s) who has/have acquired the share capital of the firm, or in possession of their spouses, parents, child, or children’s direct heirs. 2. The majority of votes may be indirect or direct. 3. At least one representative of the family or kin is involved in the management or administration of the firm.” This definition also applies to listed companies that meet the definition of family enterprise if the person(s) who established or acquired the firm (share capital) or their families or descendants possess 25% of the right to vote mandated by their share capital (EU Commission, Report, 2009). This was the first time that an official, high-level body adopted a definition of the family firm in order to establish a framework for successive
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and empirical developments that can be summarized as follows: 1. The definition of the main dynamic relationships between family and business using interpretative frameworks based on different stages of the firms, people, and families’ life cycles. Along this line, Miller and Le Breton-Miller (2005) identified four elements that should secure the family businesses’ success in the long run. They are (1) continuity, that is, the will of family firms to constantly and passionately realize their mission; (2) community, achieved through a cohesive team of employees united by strong values; (3) connections, since relationships with partners vastly exceed the time span and scope of ordinary market transactions; and (4) command, since family business decision makers are able to act independently, rapidly, and without rigid restrictions from shareholders; 2. A more in-depth (and insightful) approach to family business successions, admitting complex situations characterized by multiple family and nonfamily leadership candidates, and subsequently stating the importance to base the successor’s selection on specific criteria such as motivation, managerial abilities, career development, outside work experience, formal education, training programs, etc.; 3. A closer attention to the differences between different types of family firms, going beyond the traditional overlap with small- and medium-sized enterprises. Along this line, Corbetta proposed four archetypes of family firms corresponding to different sizes and ownership concentration levels, and also showing typical evolutional patterns from one stage to another. Consistent to this, recent studies are increasingly arguing for the importance of sampling issues, both in terms of firm size and family ownership concentration, to influence actual research results (e.g., Miller, 2013); 4. A theoretical and empirical quest to understand the direct family ownership effects on firm behavior and performance, leading to conceptualize both the negative sides due to increasing agency costs related to problems of altruism and self-control (Schulze et al., 2001), as well as the positive sides of ‘distinctive familiness,’ which can lead to familybased advantages and transgenerational wealth creation (Habbershon et al., 2003). Despite the long-lasting search, however, a recent large-scale meta-analysis showed that on average family ownership has either no effect or at best offers a small performance advantage relative to other types of ownership. 5. A stronger focus on formal aspects of family governance and leadership, including the functioning of boards of directors (Anderson and Reeb, 2004), but mostly the effect of family leadership on firm performance (Anderson and Reeb, 2004; Minichilli et al., 2010). While most of these studies report a positive effect of family leadership, others raise the importance to contextualize these results within specific family firm ‘types’ or ‘configurations’ (Miller et al., 2013). 6. The importance of recognizing different levels of analysis in family business research, going beyond the importance of individuals and individual leaders, but also considering (1) interpersonal or group-level relations (e.g., between different groups of family and nonfamily employees and
managers); (2) organizational level, pointing out five different sources of capital such as human, social, survivability, patient capital, and family governance structures; and (3) the role of family firms in society and at a societal level (Sharma, 2004); 7. The distinctive behavior of family firms, with respect to emotions, exploring various constructs such as emotional capital, emotional ownership, emotional returns and costs, and emotional value. These ideas have been recently conceptualized in the socioemotional wealth (SEW) approach in studying family business (Gomez-Mejia et al., 2011); 8. The influence of emotions and distinctive family (economic and noneconomic) goals on strategic objectives and decisions in family firms. According to Chrisman et al. (2005), family firms show relevant specificities in terms of (1) strategic objectives, which go beyond profit maximization and include set nonfinancial goals such as family satisfaction and sustainability of the business across the family’s lifetime; (2) strategic choices, which include also quality and long-term relationships with suppliers, customers, and local communities; and (3) strategic processes, which tend to be based on trust mechanisms, cohesion, and a value-driven business orientation made possible by higher levels of goal alignment between owners and managers; 9. The subsequent strategic alternatives available to family firms, providing insights on the business or corporate strategies used by family firms to exploit their unique resources and capabilities. As such, various studies considered the relationship between family involvement in the business and choices such as diversification, acquisitions, corporate social responsibility, and financing choices, among others. These important theoretical and empirical developments have crystallized a double-edged vision of the family firm, which includes both the positives and the negatives of family control descending from the previous considerations, also characterized as the ‘bright’ and the ‘dark’ side of family involvement in business (Minichilli et al., 2010). According to a recent review, the positive aspects include (Gomez-Mejia et al., 2011) the following: l l l
l l
Patient capital that values long-term returns over short-term gains; Affective commitment of owners, managers, and employees; A culture that fosters employee identification with the organization and lower employee turnover, thereby ensuring continuity and the capacity to pursue long-term projects; Accumulation of social capital, which becomes a ‘moral resource’; Continuity of leadership, offering greater resilience in hard times and faster decision making.
These aspects turn into negative aspects of the family when one (or more) of the following phenomena occur (GomezMejia et al., 2011): l
Appropriation of firm resources to satisfy parochial family desires;
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Nepotism, cronyism, and incompetent family members on the payroll; l Excessive effort expended on family emotions and conflict, which distract from paying attention to market forces and business matters; l The ‘spoiled kid syndrome,’ which can create feelings of inequity among employees; l Parental altruism, overuse of business perks, and biased hiring decisions. The intellectual curiosity to further explore the pros and cons of family involvement in business in different types of firms, as well as in different contexts, resulted in a growing number and quality of scientific articles both in field and in top-tier generalist journals. This is witnessed by the impact factor (IF) trend of the field journal (FBR), which obtained the first IF in 2007 (equal to 0.67), growing up to 2.42 in 2010, at comparable levels of more established management journals. At the same time, the interest in the topic has been marked by a wealth of articles published in journal special issues. Among the most recent experiences, Schulze and Gedajlovic edited in 2010 a special issue for the Journal of Management Studies entitled ‘The family and enterprise: Unpacking the connections,’ and exploring a number of emerging issues in family business research such as the impact of top management teams’ composition and diversity on performance, the diversification decisions in family-controlled firms, or the effect of family control and ownership in different institutional settings. Interestingly, then, Steir, Lumpkin, and Wright edited in 2011 a further special issue in the Strategic Entrepreneurship Journal entitled ‘Strategic Entrepreneurship in Family Business,’ in which they discuss the ways in which the influence of family matters to strategic entrepreneurship, and how strategic entrepreneurship can contribute to understanding and strengthening of family firms, discussing concepts such as entrepreneurial orientation and portfolio entrepreneurship in family firms, mostly in a resource-based framework. Finally, the interest in family business research has overcome in the past decade the boundaries of management research, with a growing number of contributions from influential scholars from the fields of economics, finance, and even sociology. Economists for the most part have tended to focus on questions relating to the governance of the family firm and its influence within the global economy (La Porta et al., 1999), focusing on the variety of mechanisms that family-controlled firms use to enhance their power, while finance-oriented scholars mostly concentrated attention on the role of family managers’ style on firm performance, as well as the impact of family and nonfamily CEOs’ succession (Bennedsen et al., 2007).
From the Present to the Future of Family Business Studies The Theoretical Arena A first important element to identify future directions of development for the field relates to the theoretical arena, which today characterizes family business studies. Despite the impressive number of published conceptual articles, indeed, it
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seems that family business scholars mostly used established theories, applying them to family firms for the purpose of understanding and explaining their uniqueness. According to agency theory (Jensen and Meckling, 1976; Schulze et al., 2001), one of the common assumptions of economic-based investigations of family firms is that they are believed to lower agency costs due to the alignment of interests between owners and agents. Nevertheless, recent interpretations and substantive works by Bill Schulze and colleagues emphasized the negative aspects of close alignment between owners and agents, and highlighted the risk of the so-called parental altruism,’ that is, the tendency of parents to attribute benefits to family members (e.g., higher compensation, consumption of perks, and generous or ‘familial’ appointments), in general, serving all the specific interests of the family. The ‘failure’ of the agency theory to satisfactorily explain the family executive’s behaviors led scholars to rely more on psychological aspects of human beings to support evidences from family business studies, such as the stewardship theory (Corbetta and Salvato, 2004). According to the stewardship theory, in serving their corporations, family executives are driven by both economic and noneconomic rationales, and experience satisfaction from the ability to share, help, and support other cherished family members in the process. They are also motivated by a need to gain intrinsic satisfaction through effectively performing exigent work, and thereby to gain recognition from peers and superiors. This contributes to these managers’ sense of identity and self-esteem deriving by identification with their company and their fulfillment of family obligations. The growth in rigor, relevance, and width of family business studies over years progressively attracted attention from strategy scholars, with the natural consequence of crossfertilization among studies and theories. One of the most notable results has been the rise of the resource-based view (RBV) (Barney, 1991) as a theoretical lens to identify resources and capabilities that are unique, scarce, valuable, hardly imitable, and with significant rent potentials within family firms. Under this view, family involvement (so-called familiness) contributes to the building up of competitive advantage over ‘faceless’ competitors for the firm through higher stocks of social capital and ‘patient’ financial resources that enhance the firm’s economic sustainability and longevity (Miller and Le Breton-Miller, 2005). These resources can also contribute indirectly to firm performance through the achievement of outcomes such as the preservation of family ties and transgenerational value creation (Sharma, 2004). Nevertheless, the inability of the agency, stewardship, and RBV to univocally predict the positive or negative side of family businesses led a number of scholars to propose novel interpretative theoretical lenses to investigate family business phenomena. On the one hand, some studies tried to combine agency and stewardship predictions in order to reconcile predictions stemming from the economic and psychological rationales that characterize, respectively, those two theories. As a result, many other studies suggest that family involvement is an unambiguously positive or negative influence, whereas the interpretive framework proposed by these scholars significantly conditions both those expectations. The underlying thesis here is that both
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these well-argued views of family business may hold, but under different circumstances, largely characterized by the degree to which a business and its top executives are embedded within a family. On the other hand, another group of scholars tried to introduce a new paradigm in the family business field, which again combines psychological and economic rationales in family firms’ decision making, but using the preservation of the ‘socioemotional endowment’ of a family as the economic reference point for strategic decisions. Introduced by GomezMejia et al. (2011) as a variant of the behavioral agency model, the SEW perspective refers to nonfinancial aspects of the firm that meet the family’s affective needs, such as identity, the ability to exercise family influence, and the perpetuation of the family dynasty. Based on the assumption that family firms may give priority to socioeconomic rather than purely economic rationales, the preservation of SEW is a crucial feature of family firms. The SEW perspective has recently been used in the context of family firms to explain their uniqueness with regard to a range of topics, such as managerial entrenchment or executive compensation. The general conclusion from this research is that controlling family owners tend to be guided by a set of motives different from those for other types of owners.
Theory Building or Theory Testing: Rigor and Relevance The theoretical prolificacy represents one of the distinctive features of the family business field, as well as one of its potentially problematic issues. Searching for a unique (and unifying) conceptual framework to understand family firms’ characteristics and behavior, scholars have traditionally attempted to propose new concepts, ideas, and framework, with the result that empirical testing of newly elaborated constructs has been often downplayed. Among recent studies published in the FBR, for instance, constructs and related propositions on family emotions, family social capital, and knowledge integration have been proposed, but not tested yet. This evidence parallels calls from the SEW growing literature: despite SEW being so far used as an interpretative framework to explain outcome variables, few or no studies actually measured the socioemotional dimension of families, and the challenge to measure SEW is definitely next. This impression is confirmed in a recent work (Tognazzo, 2012), which considers 279 articles published in the FBR from 1998 to 2010, for the purpose of distinguishing between theory building (introducing new constructs, new relationships, or variables) and theory testing (test hypothesis on the bases of previous theories using large samples). Interestingly, trends of theory building and testing in FBR are stable over the past decade, with theory building dominating over theory testing, exactly the opposite of what the author found in more traditional journals such as the Academy of Management Journal, Administrative Science Quarterly, and Strategic Management Journal, in which theory testing instead dominates. At the same time, however, the relevance for practice, which traditionally characterized FBR articles, significantly dropped in the past decade, with the article practical relevance score halved during the period considered for the analysis. It confirms a tendency toward a proliferation
of new constructs and relationships, at the expense of more ‘rigorous’ tests of established paradigms on large samples, also in order to gain legitimacy in the field, as well as of ‘relevant’ research with practical implications. As in most of the managerial fields, the simultaneous search for rigor and relevance should dominate the scholarly agenda over the next few years.
Some Insights on the Next Developments in the Family Business Field Drivers of Development A recent survey of 80 family business scholars by Litz et al. (2012) about the state of the art and future developments of the field supports the above insights and considerations. Specifically, the authors contend how, although the field has achieved a substantial consensus, this consensus is at best of a penultimate nature (Litz et al., 2012). In other terms, the impressive growth experienced by the family business field in the past two decades has potential downsides that inhibit proper consensus. On the one hand, the fast rise in numbers of doctoral students and scholars interested in the topic determined a scattered growth characterized by spotty referencing and fragmented views of the field, casting doubts about whether this quantitative growth has always been accompanied by a qualitative development; consequently, while there is definite consensus that questions relating to family business are important, there is much less consensus as to the answers (Litz et al., 2012). This lack of consensus is mirrored by additional insights stemming from the survey. As the authors effectively summarize, “the field will need to develop and innovate by expanding its conceptual boundaries to mode deliberately include the family, enlarge its temporal boundaries to more reflectively appreciate the past, open its international boundaries to welcome findings from a growing array of international and ethnic contexts, and enrich its inherent complexity to appreciate works that present novel variables and engage in increasingly diverse set of topics” (Litz et al., 2012, p. 30). In addition to consensus, a second important driver of development might be an increasing reliance on an interdisciplinary approach to the field. In terms of necessary competencies, many family business scholars believe that most research topics need interdisciplinary team effort; in particular, researchers in different branches of management, psychology, and sociology should cooperate to capture the distinctive facets of family business. For instance, organizational behavior and social psychology can help one to better understand the role of emotions in these firms, finance can contribute in helping one to understand the constraining role of capital and financial markets on future growth, and sociology can help one to unravel the influence of institutional pressures and family networks on firm survival (Gomez-Mejia et al., 2011). The reason why interdisciplinary collaboration is not well developed is most likely because of the high costs of joint research due to the very different starting points in terms of knowledge, languages, and methodologies. Nevertheless, since in many fields radical advances come from collaboration between authors in different disciplines and professions, such collaboration should be strongly encouraged.
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Relevant Topics and Methodological Challenges In terms of content, the future development of the field will be characterized by a number of relevant issues, as well as by important methodological challenges. On the one hand, companies’ strategic context is significantly changing because of the impact of new technologies and globalization, as well as the impact of the economic crisis that started in 2008. As such, the family businesses’ capability to compete in such a context will represent a relevant research topic. Another key issue will be the impact of increasing managerial and financial sophistication on the culture and behavior of family businesses, as well as the responses of family firms to increasing institutionalization of their governance forms. This is evident in the recent development of codes of good governance for private firms (Buysse Code in Belgium; EcoDa Recommendations; Institute of Directors’ Code in the United Kingdom), and specifically for family firms (IFC Family Business Governance Handbook – World Bank; Governance für Familienunternehmen in Switzerland; Guía Colombiana de Gobierno Corporativo para Sociedades Cerradas y de Familia in Colombia). This is also related to what Chrisman et al. (2010) propose in their review and research agenda. According to these scholars, three important emerging issues in the family business research are (1) family governance systems, devoting more attention to monitoring mechanisms, informal family system versus formal ones, boards of directors in family enterprises, with the need to investigate further their composition, functioning, and performance; (2) owner–owner agency costs, investigating situations in which controlling owners may extract benefits from the firm at the expense of minority owners; and (3) noneconomic goals, which include how the pursuit of noneconomic goals can provide competitive advantage or, on the contrary, more conservative behaviors (Chrisman et al., 2010). Finally, empirical evidence from the first four editions of the annual Italian Observatory on medium and large familycontrolled firms (in collaboration with AIdAF, The Italian Association of Family Firms, Unicredit Bank, and the Chamber of Commerce of Milan) suggest additional research topics for the near future. Consistent also with the theoretical review above, these topics include the following: (1) Family firms’ heterogeneity, which should stress the importance of critical dimensions such as firm size, ownership concentration, generation in command, and family pervasiveness at different leadership levels. The adoption of a configurational approach would be of help to reassess all the traditional issues of family business investigation (including the effects of governance, leadership, succession, strategy, and performance) into specific configurations or ‘types’ of family firms. (2) Leadership (or coleadership) models: the limited attention to coleadership is surprising in light of the importance of coleadership in family firms from a conceptual standpoint, as well as in terms of magnitude of the phenomenon. Conceptually, family business literature indicated coleadership as a leadership model particularly suited for family firms at different stages of the firm development and/or generations. Coleadership may occur among cofounders, with parents, brothers, or cousins, who share the responsibility to lead
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a new venture. (3) Multilevel analyses: most family business studies followed the tendency in the broader strategic management literature to investigate the impact of managerial characteristics on firm outcomes, and this tendency has been replicated in the family business field. Nevertheless, the intrinsic interplay among actors (family and nonfamily) within family firms, and the sophistication of analytical techniques and new statistical tools allow now for the possibility of further delving into this, and more attention to multilevel investigations should be devoted. (4) Family firms’ behaviors: future research may benefit from considering more in-depth behaviors of family firms and family actors. Again, behaviors can be effectively investigated in different types of family firms, and include entrepreneurship (in smaller firms), corporate social responsibility, or stakeholder attention, as well as more strategic issues such as adaptability and responses to changing environments. On the other hand, proper investigation of these issues open important methodological challenges. First, the vast majority of existing studies relied on a rather limited set of variables, including family control and family leadership mostly. Despite the challenge posed by measurement issues, future studies should propose research designs that take into account the need to go beyond simple – although powerful – variables such as family ownership and leadership. The more accurate test of constructs related to behaviors of various family and nonfamily actors inside family firms would also be of extreme help to solve some of the theoretical tensions between economic- or psychological-based theories discussed above, and to allow a better investigation of family firms’ and family actors’ behaviors. At the same time, however, the will to more deeply investigate family businesses raise concerns on information availability. Entrepreneurs and their families are known to be very reserved and protective of their privacy. Moreover, most family businesses do not have to disclose much information about their structure or about their performances. Researchers are trying to overcome this problem by collaborating with institutions such as banks that can provide family business databases or by designing research projects based on primary sources and making use of interviews, questionnaires, and longitudinal case studies. Sponsorship will also be essential for this purpose: the strong link with family businesses and institutions will be more and more helpful in making the relationship between theory and practice mutually beneficial, and to fund large, cross-country databases. Obviously scholars should avoid focusing on short-term needs and commit themselves to identifying long-term research goals and strategies.
See also: Bourgeoisie and Middle Classes, History of; Entrepreneurship and Organizations; Ethnicity and Ethnic Groups: Historical Aspects; Family as Institution.
Bibliography Anderson, R.C., Reeb, D.M., 2004. Board composition: balancing family influence in S&P 500 firms. Administrative Science Quarterly 49, 209–237.
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Astrachan, J.H., Klein, S.B., Smyrnios, K.X., 2002. The F-PEC scale of family influence: a proposal for solving the family business definition problem. Family Business Review 15 (1), 45–58. Barney, J., 1991. Firm resources and sustained competitive advantage. Journal of Management 17 (1), 99–120. Bennedsen, M., Nielsen, K., Perez-Gonzalez, F., Wolfenzon, D., 2007. Inside the family firm: the role of families in succession decisions and performance. The Quarterly Journal of Economics 122, 647–691. Berle, A.A., Means, G.C., 1932. The Modern Corporation and Private Property. Macmillan, New York. Chrisman, J.J., Chua, J.H., Sharma, P., 2005. Trends and directions in the development of a strategic management theory of the family firm. Entrepreneurship Theory and Practice 29 (5), 555–575. Chrisman, J.J., Kellermanns, F.W., Chan, K.C., Liano, K., 2010. Intellectual foundations of current research in family business: an identification and review of 25 influential articles. Family Business Review 23 (1), 9–26. Chua, J.H., Chrisman, J.J., Sharma, P., 1999. Defining the family business by behaviour. Entrepreneurship Theory and Practice 23 (4), 19–39. Corbetta, G., Salvato, C., 2012. Strategies for Longevity in Family Firms: A European Perspective. Palgrave MacMillan, Basingstoke, UK. Corbetta, G., Salvato, C., 2004. Self-serving or self-actualizing? Models of man and agency costs in different types of family firms: a commentary on “comparing the agency costs of family and non-family firms: conceptual issues and exploratory evidence”. Entrepreneurship Theory and Practice 28 (4), 355–362. Gomez-Mejia, L.R., Cruz, C., Berrone, P., De Castro, J., 2011. The bind that ties: socioemotional wealth preservation in family firms. Academy of Management Annals 5, 653–707. Habbershon, T.G., Williams, M.L., MacMillan, I., 2003. A unified systems perspective of family firm performance. Journal of Business Venturing 18 (4), 451–465. Jensen, M.C., Meckling, W.H., 1976. Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics 3, 305–360. La Porta, R., Lopez-de-Silanes, F., Shleifer, A., 1999. Corporate ownership around the world. Journal of Finance 54 (2), 471–517.
Litz, R.A., Pearson, A., Litchfield, S., 2012. Charting the future of family business research: perspectives from the field. Family Business Review 25 (1), 5–15. Miller, D., Le Breton-Miller, I., 2005. Managing for the Long Run. Lessons in Competitive Advantage from Great Family Businesses. Harvard Business School Press, Boston, MA. Miller, D., Minichilli, A., Corbetta, G., 2013. Is family leadership always beneficial? Strategic Management Journal 34 (5), 553–571. Minichilli, A., Corbetta, G., MacMillan, I., 2010. Top management teams in family controlled companies: ‘familiness’, ‘faultlines’ and the impact on financial performance. Journal of Management Studies 47 (2), 205–222. Schulze, W.S., Gedajlovic, E., 2010. Whiter family business. Journal of Management Studies 27, 1919–204. Schulze, W.S., Lubatkin, M.H., Dino, R.N., Buchholtz, A.K., 2001. Agency relationships in family firms: theory and evidence. Organization Science 12, 99–116. Sharma, P., 2004. An overview of the field of family business studies: current status and directions for the future. Family Business Review 17, 1–36. Tognazzo, A., 2012. Entrepreneurship and Performance in Family SMEs: From Theoretical Models to a Competency Approach. PhD Thesis. Università di Padova. Westhead, P., Cowling, M., 1998. Family firm research: the need for a methodological rethink. Entrepreneurship Theory and Practice 23 (1), 31–56.
Relevant Websites www.fbn-i.org – Family Business Network. fbr.sagepub.com – Family Business Review. www.ffi.org – Family Firm Institute. www.ifera.org – International Family Enterprise Research Academy.