Family firms: should they hire an outside CFO?

Lutz, Eva; Schraml, Stephanie

doi:10.1108/02756661211193802

Cited by 23 publications

(24 citation statements)

References 10 publications

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“…Related to hiring non‐family members, evidence indicates that family business goals may affect the choice as to who leads the firm; the presence of more family‐specific goals may reduce the likelihood that a family business would hire a non‐family CFO (Lutz and Schraml ). Furthermore, evidence indicates private family firms with intra‐family succession goals hire fewer non‐family managers, yet firm size moderates that effect; larger firms with intra‐family succession goals tend to hire more non‐family managers (Fang et al .…”

Section: Review Of Family Business Goals Literaturementioning

confidence: 99%

Family Firm Goals and their Effects on Strategy, Family and Organization Behavior: A Review and Research Agenda

Williams

Pieper

Kellermanns

et al. 2018

Int J Management Reviews

146

107

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Goals are a key differentiator between family businesses and non-family businesses.To improve understanding of this topic, the authors take stock of what they know about goals in family business. They synthesize prior research findings and classify the research into five categories: family business goal antecedents; goal characteristics; goal-related outcomes; moderators of goal outcomes; and feedback loop. The paper concludes by highlighting future research to advance both family business goal and general management research.

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Section: Review Of Family Business Goals Literaturementioning

confidence: 99%

Family Firm Goals and their Effects on Strategy, Family and Organization Behavior: A Review and Research Agenda

Williams

Pieper

Kellermanns

et al. 2018

Int J Management Reviews

146

107

View full text Add to dashboard Cite

show abstract

“…However, as long as they are financially successful, family firms seem to prefer to exclude non-family CFOs from their management teams, as they fear a loss of independence and control. In contrast, when family firms experience financial distress and need to reduce their financial risk position, they often turn to non-family CFOs (Lutz and Schraml, 2012). The instillation of a non-family CFO can then help the family firm to professionalize its finance and accounting practices (Filbeck and Lee, 2000;Di Giuli et al, 2011) and improve its performance.…”

Section: Introductionmentioning

confidence: 99%

Non‐family CFOs in family businesses: do they fit?

Hiebl

2013

Journal of Business Strategy

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Purpose: This article seeks to explore success factors for integrating non-family CFOs in family firms. The integration of non-family CFOs is of great importance to family firms, as the CFO position is often the first management position in family firms for which non-family managers are recruited. Moreover, non-family CFOs can bring in valuable know-how to the family firm and reduce the family firm's financial risk. Design/methodology/approach: The findings of this study are based on a qualitative field study in Austrian family firms. The views of non-family CFOs, family managers, family board members, and non-family CEOs were obtained through semi-structured interviews. Findings: Four larger success factors for non-family CFOs and five for controlling families were derived. The most important factor for non-family CFOs that emerged from the study was that CFOs should be appreciative of the peculiarities of family firms. For controlling families, the results suggest that it is advisable to provide the non-family CFO enough space to effectively conduct their job as well as respect the CFO's views. Practical implications: Both non-family CFOs and controlling families may find the results presented in this article useful for creating a successful integration of non-family CFOs in family firms. The success factors presented should be directly applicable for CFOs and controlling families. Originality/value: This study is the first to investigate success factors for the integration of non-family CFOs into family firms. Moreover, the results of this article may also be useful to the under-researched field of non-family managers in family firms in general.

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“…Previous researches provide evidence that family leadership is strongly associated with financial performance (Anderson and Reeb, 2003;Villalonga and Amit, 2006). The family manager suggests long-term growth aims of firm value rather than a nonfamily manager (Lutz and Schraml, 2012). Family involvement in the top management team presents a positive relationship with performance (Mazzola et al, 2013).…”

Section: Family Manager and Firm Valuementioning

confidence: 99%

Family in Top Management Team and Firm Value: Do Gender and Education of Family Manager Matter?

Sumarsono

2020

Shirkah

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The in-hand study sheds some light on empirical relationship between involvement of family members in the top management team and family firm value. Specifically, this study examines how gender and education of family managers affect firm value in Indonesian context. The total sample employed in this study consisted of 935 observations with 235 family companies. The data required in this study were collected from various sources. Drawing on fixed effect regression, the results identified that the involvement of family members in top management team significantly affected the family firm value. It was also revealed that the female family manager had a lower firm value than the male family manager. Moreover, the education level of the family manager positively affected the firm value. These results provide an empirical evidence on how gender and education of family managers influence family firm value. It is further depicted that the results of this study are in line with the upper echelons theory in which the differences in human resources (e.g. gender and education) arisen from the family involvement in a management undeniably affect family firm value. As for the practical contribution, this study suggests that powerful actors in the family firms should be a family member involved in a management. It is also a worth saying that the involvement of family members on the top management teams should consider gender and level of education.

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Family firms: should they hire an outside CFO?

Cited by 23 publications

References 10 publications

Family Firm Goals and their Effects on Strategy, Family and Organization Behavior: A Review and Research Agenda

Family Firm Goals and their Effects on Strategy, Family and Organization Behavior: A Review and Research Agenda

Non‐family CFOs in family businesses: do they fit?

Family in Top Management Team and Firm Value: Do Gender and Education of Family Manager Matter?

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