Family Firm Performance and the First-Generation Change: Evidence from Latvia

18 Pages Posted: 13 Dec 2023

See all articles by Anete Pajuste

Anete Pajuste

Stockholm School of Economics, Riga; European Gorporate Governance Institute (ECGI); Boston University

Janis Berzins

BI Norwegian Business School

Abstract

We examine succession and performance of family firms in Latvia. Latvia offers a natural setting to examine first-generation succession, because a majority of these firms were established shortly after the country gained independence in the early 1990s. Initial findings indicate that often the founding family does not have a majority at the outset. It takes 20 years for family ownership to exceed 75% and for firms with second-generation ownership to reach almost 10% of the sample. Notably, approximately 80% of the sample firms are still majority-owned and managed by their founders and report higher ROA than nonfamily firms do.

Keywords: family firms, succession planning, family ownership, Corporate governance, return on assets (ROA)

Suggested Citation

Pajuste, Anete and Berzins, Janis, Family Firm Performance and the First-Generation Change: Evidence from Latvia. Available at SSRN: https://ssrn.com/abstract=4663481 or http://dx.doi.org/10.2139/ssrn.4663481

Anete Pajuste (Contact Author)

Stockholm School of Economics, Riga ( email )

Strelnieku iela 4a
Riga, LV 1010
Latvia

European Gorporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Boston University

595 Commonwealth Avenue
Boston, MA 02215
United States

Janis Berzins

BI Norwegian Business School ( email )

Nydalsveien 37
Oslo, 0442
Norway

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