Debt financing and growth of Ghanaian family-owned businesses: The dual role of family values

Abstract

ABSTRACT This study investigates how family values can create finance and growth challenges for family-owned businesses in emerging economies. Specifically, it explores the interplay between family values, debt financing, and firm growth, while also considering the moderating role of self-enhancement and self-transcendence in this relationship. The paper uses Schwartz’s theory of human values to illustrate how incorporating indigenous ontologies based on Ubuntu can lead to sustainable growth in family businesses in Ghana and the African continent. A sample of 295 Small and Medium-sized family businesses in Accra, Ghana, was selected using purposive sampling, and multiple regression modeling was used to test the study’s hypotheses. The study employed Cronbach’s alpha and factor analysis to assess the reliability, validity, and variations between observed and correlated variables. The results suggest that family businesses with conservation, openness-to-change, and self-enhancement values may not be inclined to utilize debt financing, and conservation values have a negative effect on family business growth. The study also found that self-enhancement, conservation, and self-transcendence values positively moderated the relationship between debt financing and family business growth, with self-transcendence values playing a more significant role. These findings contribute to a better understanding of the complex relationship among family values, debt finance, and business growth in emerging economies, and lay a foundation for future research.