Environment-friendly practices: Family versus non-family firms

Abstract

The effect of family ownership on the environmental performance of firms has been increasingly investigated in the economic and business literature, adopting various theoretical frameworks. Nonetheless, only limited empirical research is available, especially in cross-country contexts. Integrating socioemotional wealth (SEW) and stewardship perspectives with institutional theory, this study provides evidence on the relationship between family firms and environment-friendly practices (EFP), highlighting the moderating role of regulatory pressure. Drawing on Enterprise Surveys (ES) conducted in 2018–2020 and applying multiple regression analyses, family ownership is found to be positively associated with the propensity to engage in pollution prevention and control. This evidence corroborates the idea that ceteris paribus SEW and reputational assets associated with family businesses can leverage the tendency of firms to mitigate their environmental footprint. Furthermore, greater institutional pressure appears to be particularly beneficial for non-family firms, which are less likely to pursue nonfinancial goals.