Calling upon stakeholder theory and the socioemotional wealth (SEW) literature, we investigate how SEW impacts the decline-stemming strategies of family firms. Drawing on a recent conceptualization of SEW, we validate a two-dimensional measurement of the construct using a content analysis technique. Our empirical test on a sample of publicly traded family firms in need of turnaround suggests that the strategic preferences of family firms change depending upon the type of SEW (extended vs. restricted) the owning family values the most. The fine-grained characterization of SEW adopted in this study accounts for within-family-firm differences and thus enables the reconciliation of conflicting findings in the literature.

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Purpose – The purpose of this paper is to examine the relationship between available slack and firm performance in Italian family-controlled public firms (FCPFs) from 2006 to 2010. In addition the authors analyze the moderating effects of specific board structure variables on the relationship between slack resources and firms’ performance. Design/methodology/approach – A pooled cross-section of family and non-family publicly traded firms was drawn from COMPUSTAT global and matched with corporate governance and family firm variables hand-collected from companies’ standard profiles from Italy's primary stock exchange, Borsa Italiana. The hypotheses were tested using the feasible generalized least square method in order to analyze the data from 583 firms-observations, controlling for self-selection bias and reverse causality. Findings – The study shows that FCPFs with available slack experience less than proportionate increases in performance, suggesting a concave curvilinear slack-performance relationship. However, the slack-performance relationship is contingent on board independence and board size: greater board independence and larger boards in FCPFs relate to higher performance when the firm lacks or has too much slack available. The findings suggest that a balanced approach of oversight and stewardship helps families to make better resources allocation, to the benefit of outside shareholders as well. Research limitations/implications – The slack measure was restricted to available slack. Future studies can expand this research inquiry with other forms of slack, including potential and recoverable slack. The sample included only publicly traded family and non-family firms, thereby limiting the generalizability of the findings to other types of family enterprises. Lastly, the results only attend to the slack-performance relationship by controlling whether the firm's performance is below or above the industry average. Practical implications – Policy makers and non-family stakeholders may rely on the findings better understand the factors that can alter the family's propensity for risks and its related strategic decisions in the Italian context. Procedures to fully monitor family management's decision making or, at the other extreme, to give the family free reign are likely to disadvantage families, their business, and their outside stakeholders. Originality/value – The study reconciles the debate on the role of slack on firms’ performance by proposing a curvilinear relationship. The study is one of only a handful of research inquiries centrally addressing the role of slack in family-owned businesses, and the only analysis focussed on Italian FCPFs.

Purpose The purpose of this paper is to examine the relationship between congruence between employee and employer psychological contract fulfillment and commitment. The authors further studied how the relationship is moderated by distributive justice. Design/methodology/approach The authors conducted polynomial regression analyses with response surface methodology on two Korean samples. Findings Congruence between employee and employer psychological contract fulfillment was positively related to affective commitment and occupational commitment. Distributive justice moderated these relationships. Research limitations/implications The main limitation was common method bias as a result of the cross-sectional nature of the study designs. Practical implications Employers must be vigilant not only with regard to fulfilling employees’ psychological contracts but also to doing this fairly. Originality/value The authors studied the interaction effect of distributive justice on the relationship between psychological contract congruence and commitment in Korea.