Family Business Performance and Succession

Family businesses—firms in which ownership or control is concentrated in the hands of a single family across at least one generation—account for the majority of companies worldwide and a substantial share of global economic output, yet they operate under pressures and incentive structures that differ markedly from those of publicly traded corporations. Researchers study how family involvement shapes strategic decisions, from the willingness to pursue risky innovations to the timing and structure of leadership transitions, often drawing on the concept of socioemotional wealth—the nonfinancial value families derive from control, identity, and legacy—to explain why these firms sometimes behave in ways that appear to sacrifice profit. A central tension in the field concerns succession: transferring leadership across generations is the single most common cause of family firm decline, yet the governance mechanisms and relational dynamics that make a handover succeed or fail remain imperfectly understood. Current work is pushing into questions about how family social capital and long-term orientation interact with pressures to internationalize and innovate, and whether the stewardship relationships that sustain family firms in stable environments become liabilities when markets shift rapidly.

Works

62,249

Total citations

656,720

Keywords

Family FirmsSocioemotional WealthAgency RelationshipsEntrepreneurshipSuccession PlanningCorporate Governance