An Introduction to Law and Management of Family Firms

Abstract

Family businesses have long been neglected as a research topic, both from a legal and economic perspective. They share this fate with closed companies in general, dominating the corporate landscape nearly everywhere in terms of numbers, but nonetheless outweighed by large listed stock corporations in terms of academic attention. From an economic point of view, the scholarly neglect of family firms is partly due to the paucity of readily available data that makes empirical research difficult. From a legal point of view, one of the main reasons lies in the significant dynamics of capital market regulation which have fascinated many business law professors over the last two decades, leaving them little time for supposedly old-fashioned corners of company law. However, there are signs that the academic tide is turning: Family firms are slowly, but steadily receiving more attention in law schools and business schools. This encouraged us to make them the focus of our German-Spanish Symposium, to take stock of the current state of legal research on family businesses and explore promising avenues for future research.
This introductory paper addresses four major topics which will be dealt with one after the other: First, it explains in detail why we should be interested in family firms (II.) Second, it points out what makes family businesses different from other businesses (III.). Third, it takes a closer look at the legal forms in which family firms are organized (IV.). Finally, it analyses the governance framework for family businesses through the lens of company law and contract law (V.).

Note: This contribution is published in the Max Planck Private Law Research Paper Series with the permission of the rights owner, Mohr Siebeck.

Keywords: family firms, law of family firms, closed companies, law and management of family firms