Ownership Control Eats Strategy and Culture for Lunch: The Case for Future Ownership Development Prior to Ownership Transition

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DOI:

https://doi.org/10.24310/ejfbejfb.v11i1.12026

Keywords:

Ownership, Transition, Future, Culture
Agencies: NO

Abstract

A review of the academic research and practitioner best practices literature highlights how little we still know about the role that ownership control plays in the continuity of founder-controlled and family-controlled firms. Founder-controlled firms have been shown to financially outperform other firms. Allowing for more nuanced findings given the heterogeneity of family businesses, a similar advantage has been found in family-controlled firms around the world when their performance is contrasted with that of management-controlled firms. Research points to generational and family participation effects that may contribute to a gradual decline in this advantage over the generations. Still, controlling families of family firms face the prospect of leading a family-controlled firm across generations that continues to derive the financial and noneconomic benefits of such control or to squander that opportunity by not having ownership control be a fundamental consideration in their owners’ strategy when facing a generational transition. Statutory ownership control, psychological ownership and family unity approaches are all considered in an exploration of a future ownership development perspective and approaches that controlling families can take to preserve ownership control and the resulting comparative advantage evidenced in higher financial and noneconomic returns over generations.

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References

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Published

2021-06-17

How to Cite

Poza-Valle, E. (2021). Ownership Control Eats Strategy and Culture for Lunch: The Case for Future Ownership Development Prior to Ownership Transition. European Journal of Family Business, 11(1). https://doi.org/10.24310/ejfbejfb.v11i1.12026

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Research article