Is the Family an ‘Asset’ or ‘Liability’ for Firm Performance? The Moderating Role of Environmental Dynamism

Journal of Small Business Management, 2014 52(2), pp. 210–225

28 Pages Posted: 15 Mar 2014 Last revised: 6 Feb 2020

See all articles by Francesco Chirico

Francesco Chirico

Macquarie University, Macquarie Business School; Jonkoping University - Jonkoping International Business School (JIBS)

Massimo Bau’

Jonkoping University

Date Written: March 14, 2014

Abstract

By integrating the stewardship and agency perspectives, our study extends the understanding of the dynamics that regulate the family as either an asset or liability for the firm. Our results show that the percentage of family members on the top management team (TMT) has an inverted U-shaped relationship with firm performance. However, when environmental dynamism is low this curvilinear relationship becomes steeper. When environmental dynamism is high, an increased percentage of family members on the TMT enhances firm performance.

Keywords: family firm, environmental dynamism, performance, agency, stewardship

Suggested Citation

Chirico, Francesco and Bau’, Massimo, Is the Family an ‘Asset’ or ‘Liability’ for Firm Performance? The Moderating Role of Environmental Dynamism (March 14, 2014). Journal of Small Business Management, 2014 52(2), pp. 210–225, Available at SSRN: https://ssrn.com/abstract=2409026

Francesco Chirico (Contact Author)

Macquarie University, Macquarie Business School ( email )

New South Wales 2109
Australia

Jonkoping University - Jonkoping International Business School (JIBS) ( email )

Jönköping, 55111
Sweden

Massimo Bau’

Jonkoping University

SE-551 11 Jonkoping
Sweden

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