CSR COMPARISON BETWEEN FAMILY BUSINESSES AND NON-FAMILY BUSINESS

Abstract

This paper is designed to explore whether family businesses outperform nonfamily businesses regarding Corporate Social Responsibility (CSR) performance. Upon comparing the CSR performances of 64 top family businesses in the US with CSR performances of the top nonfamily businesses in the US; the results have showed that nonfamily businesses outperform family businesses on CSR. Analysis of four out of five categories of CSR performance resulted in favor of nonfamily businesses and no statistical difference was found in one category. Hence, results show that family businesses are reluctant to corporate social responsibility concern. The result of this study may suggest that family businesses are self-interested; however, some research literature may advise otherwise. Strong agency problems and having family influence in the top management team composition may be shown as the main reason behind this phenomenon. Also results show that among the family businesses, increased family member presence in the top management has a positive effect on CSR performance. For further analysis and future studies, recommendations are made in the conclusion section.