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The Impact of Family Involvement on SMEs’ Performance: Theory and Evidence

Year: 2013

Type: article

Abstract: By complementing agency theory with behavioral assumptions, we explore the effects of family involvement on small and medium enterprises’ (SMEs) performance. We identify three separate dimensions of family involvement and hypothesize nonlinear, direct, and interaction effects on the performance of an SME. The evidence on 787 SMEs suggests that an inverted U-shaped relationship exists between family ownership and performance, and ownership dispersion among family members negatively affects performance. Balancing family and nonfamily members in the top management team (TMT) is found to be beneficial to SMEs’ performance, but the family ratio in the TMT becomes crucial only at high levels of family ownership.

Source: Journal of Small Business Management

DOI: 10.1111/jsbm.12093

Authors: Alfredo De massis, Josip Kotlar, Giovanna Campopiano, Lucio Cassia

Institutions: University of Bergamo, Lancaster University

Language: English

Topic: Family Business Performance and Succession

Subfield: Organizational Behavior and Human Resource Management

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: green

OpenAlex ID: W2034298963