The Effect of Family Control on Firm Value and Performance: Evidence from Continental Europe

Abstract

"We investigate the relation between ownership structure and firm performance in Continental Europe, using data from 675 publicly traded corporations in 11 countries. Although family-controlled corporations exhibit larger separation between control and cash-flow rights, our results do not support the hypothesis that family control hampers firm performance. Valuation and operating performance are significantly higher in founder-controlled corporations and in corporations controlled by descendants who sit on the board as non-executive directors. When a descendant takes the position of CEO, family-controlled companies are not statistically distinguishable from non-family firms in terms of valuation and performance." Copyright 2006 The Authors Journal compilation (c) 2006 Blackwell Publishing Ltd.

The Benefits of Family Ownership, Control and Management on Financial Performance of Firms

“…This view is supported by recent international studies (Anderson & Reeb, 2003;Barontini & Caprio, 2006) which at least partially control for (excess) family control.…”

“…They investigate the influence of family ownership (percent of shares) 6 , family CEOs ("active control" in their terms) and even control for excess voting control by constructing a binary for family member presence on the board of directors. Their findings are replicated for Europe by Barontini and Caprio (2006). However, the existing research on family control via ownership and the active role as managers in the firm suffers from the indistinguishableness of decision control and decision management in one-tier board systems.…”

“…Chaganti & Damanpour, 1991;Daily & Near, 2000;Galve & Salas, 1996;McConaughy et al 1998McConaughy et al , 2001Anderson & Reeb, 2003;Lee 2004;Barontini & Caprio 2006). Arguments for the use of these and similar indicators are frequently the diversity, independence and unbiased reporting.…”

Tempestividade Da Informação Contábil Em Empresas Familiares Brasileiras

“…A propriedade familiar, nos últimos anos, tem sido objeto de inúmeras pesquisas (Miralles-Marcelo, Miralles-Quirós, & Lisboa, 2014), com o intuito de verificar o efeito do controle e/ou gestão familiar nas empresas, sob a perspectiva da gestão e finanças empresariais (Barontini & Caprio, 2006).…”

“…A propriedade familiar, nos últimos anos, tem sido objeto de inúmeras pesquisas (Miralles-Marcelo, Miralles-Quirós, & Lisboa, 2014), com o intuito de verificar o efeito do controle e/ou gestão familiar nas empresas, sob a perspectiva da gestão e finanças empresariais (Barontini & Caprio, 2006).A concentração de propriedade, típica de empresas familiares, além de contribuir para a gestão e finanças empresariais, influencia de maneira positiva a qualidade da informação contábil (Alves, 2012;Cascino, Pugliese, Mussolino, & Sansone, 2010). Nesse sentido, Wang (2006) destaca que empresas familiares fornecem informações de qualidade aos usuários das demonstrações financeiras, a fim de obterem capital ao menor custo.…”