Now showing 1 - 6 of 6
  • Publication
    Family Firm Innovativeness-A Meta-Analysis
    (Academy of Management, 2014-08-05)
    Duran, Patricio
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    van Essen, Marc
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    An increasing stream of research has started to investigate innovation behavior in family firms, which is expected to be distinct from that of other types of firms; however results have been mixed so far. Conducting a meta-analysis of 110 studies covering 42 countries we synthesize prior work and extend prior knowledge on the precise linkages of family control and innovation behavior. We find that innovation input is lower in family as compared to non-family firms, yet innovation output is enhanced. We argue that lower input can be explained by the investment and decision making preferences of family owners. Higher output can be explained by family-firms' capabilities to efficaciously manage R&D resources. We further discuss and test the effect of important family-, firm-, and institutional-level contingencies. Based on the results from our meta-analytical analysis we develop new insights into the sources of competitive advantage of family firms and propose new directions for further research.
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  • Publication
    Socioemotional Wealth and Family Firm Performance: Economic Gains from Pursuing Noneconomic Goals
    (Academy of Management, 2013-08-09)
    Madison, Kristen
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    Kellermanns, Franz W.
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    Socioemotional wealth recently emerged as an important distinguishing characteristic between family and nonfamily firms. It is used in extant literature as a theoretical framework to rationalize the behavior of protecting family interests at the expense of financial success. We present socioemotional wealth differently: as a measureable construct, conceptualized through a stewardship theory lens, with empirical support for its positive relationship with family firm financial performance. Results also show hostile environments attenuate the SEW–performance relationship, indicating that firms with high socioemotional wealth are unable to make the necessary strategic adjustments needed to enhance performance in difficult environments.
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  • Publication
    Selling what you love : Divestiture activity in family-controlled firms
    (Academy of Management, 2013-08-09) ;
    Based on agency theory, prior studies in divestiture literature argued and found that blockholder ownership functions as a catalyst of divestiture activity. This reasoning, however, assumes that all types of blockholders are primarily interested in utilizing their power to optimize the economic benefits of their ownership stakes. Drawing on socioemotional wealth perspective, the present study challenges this assumption for the case of family block ownership. As a baseline, we propose that family block ownership decreases the likelihood of divestiture occurrence since divestitures pose severe threats to family owners’ socioemotional benefits. Further, we analyze under which conditions financial wealth considerations outweigh socioemotional wealth considerations. Counter to our theoretical prediction, our empirical findings indicate that financial performance is not a sufficiently strong contingency factor which helps overcome the greater reluctance of family-controlled firms to engage in divestiture. Instead, our results suggest that to offset this greater reluctance financial wealth concerns need to pair with institutional legitimacy concerns in order to increase the likelihood of divestiture by family-controlled firms. Our study thus extends agency theory and contributes to both family and divestiture literatures.
  • Publication
    Family Firm Valuation by Family FIRM CEOs: The Role of Socioemotional Value
    (FERC, 2009-04-24) ;
    Kellermanns, Franz W.
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    Chrisman, James J.
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    Chua, Jess H.
    Based on the contentions of prospect theory that ownership endows possessions with a value premium, this study provides evidence that socioemotional value in family firms influences the monetary value attached to the firm by family owners. Ability to measure socioemotional value is a critical step toward establishing that it has a direct instead of an imputed link to family firm behavior. The results from two different samples of family firm owner-CEOs show that the socioemotional values for their firms increase with their desires for transgenerational sustainability, a distinctive socioemotional attribute of family firm ownership.
  • Publication
    Why do firms strive for non-pecuniary performance?
    ( 2008-08-13) ;
    Nason, Robert S.
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    Nordqvist, Mattias
    The present paper develops an explanation of non-pecuniary performance of firms, which extends current ethical and financial rational and encompasses multiple levels of stakeholder analysis. Drawing from social identity theory and the literature on organizational reputation, we show that identity overlaps between managers and organizations create an incentive to protect and build corporate reputation, thereby motivating managers to produce non-pecuniary performance outcomes that satisfy reputation forming stakeholders. We suggest that the link between identity overlaps and the incentives to build and protect corporate reputation is moderated by the type of the manager's commitment and provide empirically testable propositions for our claims. We use the family business, a particularly high identity overlap organization, as a context to explore our arguments.
  • Publication
    Financial performance of privately held family firms
    The present text examines how the organizational input variable "family" and the financial output variable "return" are interrelated. This question is crucial since there are serious doubts brought forward by Schulze et al. (2003) whether family firms really exhibit the ideal precondition of low agency costs as hypothesized by Fama and Jensen (1983a and 1983b). Schulze et al. (2003) find that family firms suffer from costly agency conflicts induced by altruism between family principals (e.g. parents) and family agents (e.g. children). Hence there is a need for research that examines the question whether family influence on a firm is boosting or hampering the financial performance.