Family Business and Capital Markets: A Survey of Evidence

Abstract

It has been a long held hypothesis that Family owned companies are not keen to raise external finance through the capital markets. On the contrary various family owned companies dominate many stock markets in continental Europe and Asia. This is mainly due to a lack of an efficient market of corporate control where private benefits of corporate control far outweigh the benefits of ownership dilution arising from accessing the capital markets. Therefore if more family owned companies are to access Uganda’s capital markets there is need to remove those conditions that hinder an efficient market for corporate control like low levels of stock market development, low levels of adherence to international best practices in corporate governance and low levels of tax compliance.