Family Business

In the last decades family business has been a rising topic of interest in both academic research and business school education. Prior to this comparatively recent change, thinking about business was dominated by ideas of the separation of ownership and control (sometimes called Berle-Means corporations after the two authors of the 1932 book The Modern Corporation and Private Property). Family business research is now published in a variety of academic journals ranging from those devoted to the topic to those in general academic fields such as economics, finance, or other social sciences. Organizations both within and without academia educate and learn from practitioners.

There are foundational definitional issues within the field (a topic of much research itself). For instance: are founder led firms family firms or do they only become so once ownership and/or control is inherited? Just how much ownership is required? Beyond these issues research on family business often focusses on succession, family values, differences between family businesses and non-family business.

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A Resource-Based Framework for Assessing the Strategic Advantages of Family Firms

Habbershon, Timothy G., and Mary L. Williams. 1999. “A Resource-Based Framework for Assessing the Strategic Advantages of Family Firms.” Family Business Review 12 (1): 1–25.

The Resource-Based View (RBV) of competitive advantage provides a theoretical framework from the field of strategic management for assessing the competitive advantages of family firms. The RBV isolates idiosyncratic resources that are complex, intangible, and dynamic within a particular firm. The bundle of resources that are distinctive to a firm as a result of family involvement are identified as the ?familiness? of the firm. This approach provides a research and practice method for assessing the specific behavioral and social phenomena within a firm that provide an advantage. Using a familiness model for assessing competitive advantage overcomes many of the problems associated with the generic claim that family companies have an advantage over nonfamily companies. It also provides a unified systems perspective of family firm performance.

Bivalent Attributes of the Family Firm

 “Bivalent Attributes of the Family Firm.” Tagiuri, Renato, and John Davis. 1996 Family Business Review 9, no. 2 (June 1, 1996): 199–208. 

Although family-owned and managed firms are the predominant form of business organization in the world today, little systematic research exists on these companies. This paper builds upon insights found in the emerging literature on these enterprises and upon our own observations to provide a conceptual framework to better understand these complex organizations. We introduce the concept of the Bivalent Attributes, a unique, inherent feature of an organization that is the source of both advantages and disadvantages? to explain the dynamics of the family firm.

Christian Family Businesses: Opportunities for Future Research

Discua Cruz, Allan. 2013. “Christian Family Businesses: Opportunities for Future Research.” Journal of Biblical Integration in Business 16 (2).

Family businesses dominate the business landscape around the world. Traditionally, research has concentrated on understanding the complex processes that underpin the creation, development, and survival of family businesses. To date, however, a Christian perspective on family business research has been largely overlooked. The aim of this paper is to explore the connections between a Christian perspective and the most prevalent business form worldwide. This paper contributes by reviewing relevant literature in the family business field and by suggesting future research paths.

Comment on ‘Family Values or Crony Capitalism?

“Comment on ‘Family Values or Crony Capitalism?’ (Harold James)” 2008 Randall Morck Capitalism and Society 3 (1).

The 20th century ran countless experiments to see what form of government works least badly. Unless things turn around unexpectedly, James I would have lost money betting on the absolute monarchy. The 21st century now gets to sort out what form of corporate governance works least badly; and I suspect Prof. James is premature in declaring for family firms.

Corporate Ownership Around the World

Corporate Ownership Around the World” Rafael La Porta, Florencio Lopez-De-Silanes, Andrei Shleifer The Journal of Finance 54 (2): 471–517. 1999 (Open Access) 

We use data on ownership structures of large corporations in 27 wealthy economies to identify the ultimate controlling shareholders of these firms. We find that, except in economies with very good shareholder protection, relatively few of these firms are widely held, in contrast to Berle and Means’s image of ownership of the modern corporation. Rather, these firms are typically controlled by families or the State. Equity control by financial institutions is far less common. The controlling shareholders typically have power over firms significantly in excess of their cash flow rights, primarily through the use of pyramids and participation in management.