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Research on family business sustainability has seen a surge over the last decade. Despite this, very little research has been performed to investigate the impact of governance on family business sustainability. Building on this gap, this paper empirically examines the impacts from organizational governance and responsible innovation on the sustainability of family-owned businesses. It also evaluates entrepreneurial culture’s contribution as a moderator of the nexus of organizational governance, responsible innovation, and business sustainability in Saudi Arabia. A sample of 396 responses were collected from 87 family enterprises; respondents were generally principal managers and/or main business owners. The relationships in the conceptual model were tested with structural equation modelling using SmartPLS. The results show that organizational governance and responsible innovation positively and statistically significantly impact business sustainability among family-owned businesses in Saudi Arabia. Furthermore, entrepreneurial culture significantly and positively moderates the organizational governance, responsible innovation and business sustainability of family-owned businesses in Saudi Arabia. The results guide regulators in regulation formulation related to the achievement of business sustainability through good governance and effective entrepreneurial culture. Government and regulatory authorities must therefore encourage family-owned businesses in their predominantly economic functions in society, while also engaging in sustainability-oriented policy making and programs.

A firm’s virtual communication with customers (VCC) simulates face-to-face communication through the Internet. This study is motivated by the low level of small family-owned businesses’ VCC in Hong Kong during the Covid-19 pandemic when face-to-face communication is restricted by social distancing measures. A firm’s VCC is decomposed into four subsets based on four major functions it performs: product promotion (pp), product customization (pc), customer service (cs), and customer ordering (od). It is hypothesized that information and cost sharing between different VCC subsets reduce the uncertainties and costs of VCC, which implies a mutually reinforcing relationship between the different subsets. Based on cross-sectional data collected from small family-owned businesses in Hong Kong during the 2020 Covid-19 pandemic, this study empirically identifies VCC determinants from the sample firms’ decision-maker characteristics, organizational characteristics, innovation characteristics, and environmental characteristics. Using the identified VCC determinants as exogenous variables, a simultaneous equations analysis is then conducted to endogenize different VCC subsets and show that pp, pc, and cs are mutually reinforcing. This implies that information and cost sharing between different VCC subsets are needed to stimulate the overall VCC by reducing the uncertainties and costs associated with it during the pandemic.

This study aims to understand the crises experienced by family-owned accommodation businesses in small island contexts and how resilience is built alongside the development of their dynamic capabilities (sensing, seizing, and transforming) as they navigate through crises. The study uses a qualitative method and focuses on the experiences of tourism businesses operating in the islands of Boracay, Negros, and Siargao, which are among the top island destinations in the Philippines. Semi-structured interviews with 18 participants were conducted through 1-hour online video calls, phone calls, and written 2 interviews. Crises that affect tourism businesses are mostly due to external factors. Small islands are at high risk of natural hazards, but businesses do not consider typhoons and earthquakes as crises per se since they frequently experience these hazards. Family businesses have distinct strategies, such as knowledge transfer, maintenance of stable financial resources, infrastructure development, employee training, better marketing strategies, and a focus on sustainability to enhance their dynamic capabilities and build their resilience, thus making them more adaptive to future crises. However, government support for the local tourism industry is still needed to ensure a sustainable tourism industry. Dynamic capabilities and resilience are often linked with each other yet there is limited knowledge on how resilience is built specifically in the context of family-owned businesses in small island context. This study addresses this gap in the literature by using dynamic capabilities as a framework to understand resilience development. Resilience and dynamic capabilities are then adaptive strategies in crisis management.

While prior literature suggests that family firms with a positive corporate image are associated with superior financial performance, their effectiveness in creating firm brand value is not well understood. In this paper, we use Interbrand's global brand value data published between 2001 and 2017 to examine the effect of family ownership and family-named firms on brand value creation. Our findings indicate that within the sample of large global firms, family firms exhibit lower brand value compared to nonfamily firms. Moreover, after controlling for agency cost variables, effective corporate governance does not improve brand value for family firms. Cross-sectional analyses reveal that the difference in brand value between family and nonfamily firms is attributable to those family firms whose founders do not hold significant power. Furthermore, we observe that family firms, whether they have a family name as part of their company name, tend to have lower brand value than nonfamily firms.

Family firms are thought to pursue nonfinancial goals that provide socioemotional wealth, but socioemotional wealth is feasible only with family control of the firm. Using prospect theory, we hypothesize that socioemotional wealth increases with the extent of current control, duration of control, and intentions for transgenerational control, thus adding to the price at which owners would be willing to sell their firms to nonfamily buyers. Findings from two countries show that current control has no impact, and duration of control has a mixed impact. However, intention for transgenerational control has a consistently positive impact on the perceived acceptable selling price.

Two contradictory perspectives of family business conduct and performance are prominent in the literature. The stewardship perspective argues that family business owners and managers will act as farsighted stewards of their companies, investing generously in the business to enhance value for all stakeholders. By contrast, the agency and behavioral agency perspectives maintain that major family owners, in catering to family self-interest, will underinvest in the firm, avoid risk, and extract resources. This paper argues that both these views have application but under different circumstances, determined in part by the degree to which the firm and its executive actors are embedded within the family and thus identify with its interests. Stewardship behavior will be less common, and agency behavior will be more common the greater the number of family directors, officers, generations, and votes, and the more executives are susceptible to family influence. These findings are supported among Fortune 1000 firms, as well as among the subsample of those firms that are family businesses.

A fundamental schism divides the family firm and strategy literatures, on the one hand, and the institutional literature, on the other, regarding both the situational prevalence and the utility of conforming behavior. The first two schools, respectively, view strategic differentiation as especially common among family firms and an important source of competitive advantage. By contrast, the reasoning of institutionalists would suggest that family firms will be subject to unusually powerful motivations to conform, in part because of their pursuit of socioemotional wealth objectives. Unfortunately, the relationships between conformity and family firm governance—and, in fact, governance in general—have not been amply studied. This analysis of Fortune 1000 firms finds considerable support for the institutional perspective: family involvement is related to greater, not lesser, conformity in many aspects of strategy. Although strategic conformity related to superior returns on assets, it did not enhance firm market valuations.

Despite increased attention given to family firms in the theory of organization and management, the value of family governance in emerging markets is not clearly understood. We draw insights from agency and institutional economics perspectives to address the debate on whether family governance fills or abuses the void left by weaker market and legal institutions. We propose a dual focus on the pattern of family control and weak institutions to reconcile these opposed assessments. We analyze how various combinations of family control over ownership, strategy, and operations yield different benefits and costs for the operational performance of firms in the absence of strong market and legal institutions. The uneven development of market institutions across industries and the impact of independent directors reinforce the importance of separating different patterns of family control. We find support for our hypotheses when tested on a data set consisting of all publicly listed firms in Taiwan between 1996 and 2005. Our study contributes to a deeper understanding of family businesses in emerging markets, highlights the importance of weak institutions in shaping relative agency costs, and illuminates the differential effects of independent directors.

This paper addresses the issue of financial communication quality by studying the determinants of earnings management practices in family and non-family businesses. Previous literature has highlighted the effect of a company's size, as a form of visibility, on earnings management practices. This study focuses on the analysis of the relationship between different forms of visibility-exposure to financial press, proximity to the consumer, size of assets, sales and firm age-and earnings quality. The results show that the forms of visibility taken into consideration have a different effect on earnings management practices. Furthermore, they show that family businesses are less likely to resort to these unethical practices, especially in the presence of financial press exposure and proximity of the business to the consumer.