Family Firms: A Breed of Extremes?

Abstract

Conflicts in the family business literature abound due to the breed’s heterogeneity. However, a key aspect of heterogeneity has been ignored—a tendency for many family firms to gravitate toward unusual and opposite extremes in their behavior toward stakeholders and their strategic initiatives. We attribute these to family emotional bonds, secrecy from scrutiny, and exceptional managerial discretion. These bivalent qualities may combine to cause both salutary and abusive treatment of stakeholders as well as extraordinary success and abysmal failure at strategic initiatives—depending on the temporal and social priorities of family owners. We present moderating conditions and propositions before developing theoretical and methodological implications.

Family Firms and Environmental Performance: A Meta-Analytic Review

“…A possible explanation for this puzzling finding is that FFs can be simultaneously responsible and irresponsible (Cruz, Larraza-Kintana, Garcés-Galdeano, & Berrone, 2014), scoring extremely high on some social dimensions -i.e., employee-related (Kang & Kim, 2020) or diversity-related (Block & Wagner, 2014) -and extremely low on others (environmental dimension). According to the seminal work of Miller and Le Breton-Miller (2020), FFs tend to "gravitate toward the extreme tails of a variety of outcome distributions" depending on their temporally and socially extended vs. restricted business priorities. In other words, studies focusing solely on the average family involvement effect on EP, subsequently used in this metaanalytical work, allows us to provide important insights about the average environmental behavior of FFs, albeit without capturing possible deviations.…”

“…By examining a range of various conceptually and methodologically based moderating contingencies, our study encourages a shift away from questioning the overall FF–EP relationship to exploring the role of moderating contingencies in establishing this relationship. Accordingly, we advance a contingency-based framework that helps predict family business behavior toward the natural environment and respond to recent calls in the family business literature to investigate the importance of contingency factors to predict the consequences of family influence on firm behavior and outcomes (Graafland, 2020; Le Breton-Miller & Miller, 2016; López-González et al, 2019; Miller & Le Breton-Miller, 2021). We hope this study will trigger future research aimed to better understand the environmental strategies of publicly traded firms with concentrated ownership structures considering the role of potential contingencies.…”

Mapping women's involvement in family firms: A review based on bibliographic coupling analysis

“…As previous studies note (e.g. Chua et al, 2018;Miller & Le Breton-Miller, 2021), the different characteristics and implications of family firms' members' influence on family firms' goals and on the creation and accumulation of SEW, represent an opportunity for future studies. Given that SEW is a reference point which works with a rational logic of choice for both economic and non-economic goals (Gómez-Mejía et al, 2007), a promising area of interest is analysing whether the presence of women in leadership positions of family firms (versus men in such roles) shapes family firms' SEW reference points.…”

“…In such firms, family and firm dimensions are intimately intertwined: family interests and involvement often impact firm behaviour; conversely, involvement in the business tends to influence family dynamics and preferences (Amore et al., 2017). These characteristics of family involvement and emotional bonding make family firms unique (Miller & Le Breton‐Miller, 2021). Despite women having historically played—and continuing to play—an important role in family firms, to date, women's involvement has rarely been incorporated into the family business research agenda (Hamilton, 2006).…”

Family businesses under COVID-19: Inspiring models – Sometimes

“…These are not trivial distinctions, and we call attention to them so as not to mislead with a Utopian portrayal of family firms. Indeed, Miller and Le Breton-Miller (2021) have argued that family firms are unusually subject to gravitating towards both positive and negative extremes . More than other kinds of firms, they tend to be socially and perhaps economically very good or very bad.…”