Firing managers: The benefits of family ownership and costs of family management

We investigate how family ownership versus family management moderates the relationship between involuntary managerial turnover (IMT) and organizational performance in public firms. We postulate extended socioemotional priorities for family owners versus more restricted socioemotional priorities for...

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Bibliographic Details
Published in:Journal of family business strategy 2021-09, Vol.12 (3), p.100411, Article 100411
Main Authors: Tsao, Chiung-Wen, Le Breton-Miller, Isabelle, Miller, Danny, Chen, Shyh-Jer
Format: Article
Language:English
Subjects:
Family management
Family ownership
Involuntary managerial turnover
Socioemotional wealth (SEW)
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Summary:We investigate how family ownership versus family management moderates the relationship between involuntary managerial turnover (IMT) and organizational performance in public firms. We postulate extended socioemotional priorities for family owners versus more restricted socioemotional priorities for family managers, thus arguing that family ownership versus management have contrasting effects on the performance implications of IMT, the former more positive than the latter. By combining hand collected survey and archival data from 299 Taiwanese listed family firms, we find that IMT is associated with better subsequent financial performance, but more so under family ownership than family management.
ISSN:1877-8585
1877-8593
DOI:10.1016/j.jfbs.2020.100411