Family firms and performance empirical analysis from Spain

Abstract

This paper provides empirical evidence on the impact of family-controlled firms on corporate performance, using financial information of 47590 family firms from 2010 to 2014. From the overall sample, approximately two-third of family firms have concentrated ownership, meanwhile, the remaining one-third have dispersed and unknown ownership. With respect to generation, 76% of the family firms were in the first generation, 21% for the second generation and approximately 3% for the third generation. The main findings are that ownership structure of family firms have a positive impact on their performance. Specifically, family firms with concentrated ownership outperformed family firms with dispersed ownership; however, family firms in the 1ª generation outperform family business in the 2ª and 3ª generation. Also, aggressive incentive policy negatively affects the performance of family business for the 1ª generation and has no impact on performance for 2ª and 3ª generational firms. Unlisted family firms have lower performance than listed family firms. Lastly, medium size family businesses outperform than small and large size family businesses.

Determinant Factors of Founding-Family Firms’ Performance in Indonesia

“…This finding confirms previous findings gap (e.g. (Bambang & Hermawan, 2012;Harjito et al, 2021;Juniarti, 2015;Martin-Reyna & Duran-Encalada, 2015;Ntoung et al, 2017;Zattoni et al, 2015) that does not provide a comprehensive picture of determinant factors founding-family firms' performance. However, the result cannot explain which founding-family generation that can give an optimal performance to the firms since there is a data limitation for this research.…”

“…First, this research fills the previous findings gap of performance in the founding-family firms (e.g. (Bambang & Hermawan, 2012;Harjito et al, 2021;Juniarti, 2015;Martin-Reyna & Duran-Encalada, 2015;Ntoung et al, 2017;Zattoni et al, 2015). By involving founding-family firms' factors that can determine firms' performance, this research captures when founding-family firms can improve performance or experience performance reduction.…”

“…The survey result shows that founding-family firms have superior performance and keep to maintain it the future. It is supported by Martin-Reyna and Duran-Encalada (2015), Zattoni et al (2015), and Ntoung et al (2017) who find that founding-family firms have better performance than non-family ones.…”

“…This research uses accounting-based and market-based firms' performance measurements (e.g. (Bambang & Hermawan, 2012;Harjito et al, 2021;Juniarti, 2015;Martin-Reyna & Duran-Encalada, 2015;Ntoung et al, 2017;Zattoni et al, 2015). Accounting-based performance is a performance that is measured by using accounting numbers in the financial statement.…”

“…This research also examines the founding-family ownership and chief executive officer (hereafter CEO) status of the founding-family member. Founding-family ownership captures the founding family role as shareholders where their increased ownership lead to increased power to determine strategic decision in the general meeting of shareholders (Ntoung et al, 2017). Founding-family ownership is measured by share proportion held by founding-family members.…”