Family Business Performance and Succession

Family businesses—firms in which ownership, governance, or management is meaningfully shaped by kinship ties—account for a substantial share of economic activity worldwide, yet they behave in ways that standard organizational theories struggle to fully explain. Researchers in this space examine how family dynamics alter decision-making around investment, risk, leadership succession, and innovation, drawing on concepts like socioemotional wealth, which captures the non-financial value families attach to maintaining control and legacy, and agency theory, which maps the often-complex relationships between family owners, non-family managers, and outside shareholders. A central and still-contested question is how family firms can transfer leadership across generations without sacrificing the relational trust and tacit knowledge—what scholars call social capital—that often underlies their competitive advantage. Active debates also surround how family governance structures affect a firm's willingness to innovate and expand internationally, particularly when those moves require ceding control or accepting outside capital.

Works

62,755

Total citations

662,984

Keywords

Family FirmsSocioemotional WealthAgency RelationshipsEntrepreneurshipSuccession PlanningCorporate Governance