Moderating Effect Of Family Involvement Research Articles

Dynamic capabilities and environmental performance: all in the family

PurposeThis study adopts the dynamic capabilities perspective to analyze environmental performance in family firms and explores the moderating effects that both family involvement in the Top Management Team (TMT) and long-term orientation (LTO) exert on the relationship between dynamic capabilities and environmental performance.Design/methodology/approachThe authors test the hypotheses on a database of 748 family tourism firms, using hierarchical regression analysis.FindingsThe authors' results show that both variables have a beneficial effect on building the dynamic capabilities to be applied to improving environmental performance. However, the moderating effect of family involvement is revealed to be more complex than that of LTO. Having a high degree of family managerial involvement positively moderates the effect of dynamic capabilities on environmental performance but only in family firms with highly-developed dynamic capabilities; conversely, in family firms with lower levels of dynamic capabilities not having this family involvement in the TMT is better.Originality/valueThis study helps advance the research on Spanish family tourism firms by adopting an approach that unveils the heterogeneity in dynamic capabilities among said firms, driven by the firms' idiosyncratic features in terms of family involvement in the TMT and their LTO. The article also provides practical insights for family business owners, managers and advisors and outlines important directions for future research.

The influence of board social activity on firm performance

This study investigates the relationship between board social activity (i.e., frequency of board meetings) and firm performance in publicly traded family and non-family firms, focusing on the moderating effects of family involvement (i.e., family ownership and at least one family member on the board of directors). Our investigation is based on a database of 172 family and non-family firms listed on the Italian Stock Exchange over a 10-year period (1098 observations). The results indicate a curvilinear (inverted U-shaped) relationship between board meeting frequency and firm accounting performance. Moreover, family involvement positively moderates this curvilinear relationship, leading to an optimal level of board meetings, which is higher in firms with increasing family involvement than in other firms. Applying behavioral governance theory, we contribute to explain how boards of directors influence firm performance through the board context (i.e., family involvement) and arrangements (i.e., frequency of board meetings/social interactions), providing evidence for family firm heterogeneity.

Corporate social responsibility, family involvement, and stock price crash risk

AbstractThis study responds to the call in Vazquez's (2018) by providing more empirical evidence on ethical issues in family business. Drawing from the agency theory, we provide new evidence about the “CSR – stock price crash risk” nexus by examining the moderating effect of family involvement. With a focus on the Chinese capital market, we find that corporate social responsibility (CSR) negatively affects stock price crash risk. Such negative correlation is stronger for family firms as compared with nonfamily firms. Three proxies of family involvement, termly family member as a CEO, lower proportion of variable compensation to CEO, and greater family control, can strengthen the alleviating effect of CSR on crash risk. Nevertheless, a second‐generation successor as executive does not exert any moderating effect. Our findings advance the comprehension of the “CSR‐crash risk” nexus from the family business viewpoint and emphasize the important role of CSR in stabilizing the stock market.

How organizational readiness for digital innovation shapes digital business model innovation in family businesses

PurposeFamily businesses often lack sufficient knowledge about digital business model innovation digital business model innovation (BMI). This study's purpose was to analyze how and when organizational readiness for digital innovation exerts a positive impact on family businesses' digital BMI. To do so, the authors examined the mediating effect of the familiness learning mechanism and the moderating effect of family involvement on this relationship.Design/methodology/approachA quantitative survey method was used to collect the data for this study. Using a sample of 282 family businesses involved in manufacturing in China, the authors conducted hierarchical regression analyses to evaluate the authors' theoretical model.FindingsThe results of this work demonstrate a positive relationship between organizational readiness for digital innovation and family businesses' digital BMI, and the find that the familiness learning mechanism mediates this relationship. The findings also show that second-generation family involvement in management moderates the direct effect of organizational readiness for digital innovation on the familiness learning mechanism, as well as the indirect effect of organizational readiness for digital innovation on digital BMI via the familiness learning mechanism. Moreover, the results establish that family involvement in ownership moderates the direct effect of the familiness learning mechanism on digital BMI, as well as the indirect effect of organizational readiness for digital innovation on digital BMI via the familiness learning mechanism.Practical implicationsThis study provides practical contributions to the literature on family businesses and to public policy, providing concrete suggestions for fostering digital innovation in family enterprises. This study also enriches our understanding of the unique conditions by which family businesses can successfully implement digital BMI.Originality/valueThis research confirms that organizational readiness for digital innovation is an antecedent of digital BMI. This finding offers a new perspective that helps explain what might lead family businesses to engage in digital BMI. This study also places the familiness learning mechanism into a theoretical framework, which expands the current understanding of how organizational readiness for digital innovation facilitates digital BMI. Moreover, this work provides new insights into the boundary conditions by which organizational readiness for digital innovation affects the digital BMI of family businesses in terms of second-generation family involvement in management and family involvement in ownership.

How and when does occupational stigma promote intent to leave? The mediation effect of <italic>family implicated stigma</italic> and the moderating effect of family involvement

<p id="p00005"><italic>Occupational stigma</italic> reflects a society’s disapproval of, and discrimination against, an individual or group based on their occupation. Workers in stigmatized occupations, such as sewer workers, garbage collectors, street cleaners, and slaughterhouse workers, can internalize this occupational stigma, which can lower their self-esteem and motivate them to conceal their occupations or even leave their jobs to seek a higher status position. Many studies have explored the effects of occupational stigma on employees’ job attitudes and performance and some demonstrate that workers who feel stigmatized by their work devalue it and themselves, and this motivates them to not fully engage in their work, and considering other work options. However, extant studies focus primarily on the effect of occupational stigma mediated by occupational identity, and overlook the fact that occupational stigma also can influence employees’ perception of their family’s identity. <break/>Based on identity boundary theory, this study examines whether occupational stigma spills over to workers’ family identity and whether this results in negative job outcomes. That is, employees perceive their families as being stigmatized because of their “dirty” occupations, which is referred to as <italic>family implicated stigma</italic>. Moreover, this study explores whether this mediating effect of family implicated stigma is moderated by the employee’s level of family involvement. In such a way, occupational stigma is perceived as a threat to the family identity of workers who do “dirty work”. In other words, ‘dirty workers’ perceive their occupational stigma as implicating their families as well. Moreover, this study finds that individuals who are highly involved in their family’s life are more likely to leave their jobs because of family implicated stigma. <break/>We surveyed 390 employees across various jobs in China to test these predictions; 384 participants completed the entire three-wave survey, and the resulting data were analyzed. Results show that family involvement moderates both the relationship between occupational stigma and family implicated stigma, and the relationship between family implicated stigma and employees’ intent to leave a job, such that these two relationships are stronger when individuals’ family involvement is high rather than low. Furthermore, this mediating effect is more salient for individuals with a high-level of family involvement compared to those with a low-level. <break/>Our findings extend the research on occupational stigma by introducing a mechanism that influences employees’ intent to leave their job due to their family’s implicated stigma rather than on their negative personal occupational identity. Additionally, this study contributes to the literature by demonstrating that occupational stigma may crucially influence employees’ families in addition to negatively affecting the workers. Moreover, this is a pioneering explorative study that tests the identity boundary theory and offers practical suggestions on managerial strategies to address occupational stigma, including methods to maintain workers facing occupational stigma.

Say-on-Pay voting dispersion in listed family and non-family firms: A panel data analysis

The study of Say-on-Pay (SOP) – a shareholder vote on executive compensation – is a key topic in the corporate governance field, despite which its influence in the context of family firms has not been studied until now. In response to this need, this paper pursues a twofold objective: first, to analyze differences in shareholder voting behavior between family and non-family firms; second, to explore the impact of increasing family ownership on voting dispersion among family firms, testing the related moderating effects of family involvement in management and governance on this relationship. Focusing on a sample of large UK listed companies from 2007–2017, our results show that the distinctive features of family firms lead to more concentrated voting positions regarding pay packages compared to non-family firms, with this voting concentration tending to be higher as family ownership increases. Moreover, while this relationship intensifies when the family is involved in management, we find partial support in the case of family involvement in governance.

Entrepreneurial orientation and product innovation. The moderating role of family involvement in management.

In this current research it has been examined, firstly, the Entrepreneurial orientation in relation with Product innovation, Incremental innovation and Radical innovation, and, secondly, the moderating effect of Family involvement in the management of companies in the relationship between Entrepreneurial orientation and Product innovation, Incremental innovation and Radical innovation. Using a sample of 634 Spanish family firms, the results found conclude that the Entrepreneurial orientation has a positive effect on Product innovation, Incremental innovation and Radical innovation, and moreover, they reveal that the Family involvement in the management of companies has a moderating effect on these relations, witnessing that family firms with higher scale of Family involvement in the management of the companies reduces the effect of Entrepreneurial orientation on Product innovation, Incremental innovation and finally, Radical innovation.

Examining the Impact of Innovation Forms on Sustainable Economic Performance: The Influence of Family Management

The aim of this research is to explore the effect that innovation, as a potential source of sustained competitive advantage and firm growth, has on the achievement of sustainable economic performance. In particular, this paper empirically examines the influence of four innovation forms (intramural R&amp;D, extramural R&amp;D, product innovation, and process innovation) on firms’ sustainable economic performance, considering the moderating effect of family involvement in management. To test the hypotheses, random-effects regression analyses are applied to a longitudinal sample of 598 Spanish private manufacturing firms throughout the 2006–2015 period. The results show a negative effect of intramural and extramural R&amp;D on sustainable economic performance and a positive effect of process innovation on sustainable economic performance. Moreover, a reinforced relationship between process innovation and sustainable economic performance is also revealed when family involvement in management acts as a moderator. The findings make several contributions to research and practice.

Family Involvement in Ownership, Management, and Firm Performance: Moderating and Direct-Effect Models

This study aims to provide an empirical evidence on the moderating effect of family involvement in management (family CEO and founder CEO) on the relationship between family ownership and firm’s performance. From a sample of 75 public listed companies (375 firm-year observations) in Saudi Arabia, we use a five-year interval (2007-2011) and two firm performance indicators (market to book value (MBV) and return on assets (ROA)) to test five hypotheses. The hypotheses that there is a direct impact of family ownership and founder CEO on ROA and MBV were supported respectively. The hypothetical moderating impact of family CEO and founder CEO have been partially confirmed with MBV. Overall, the findings highlight the importance of occupying CEO positions in family firms by family members, especially the founders for gaining better performance. However, the results are robust when only family firms are examined separately.

The moderating effect of family involvement on substance use risk factors in adolescents with severe emotional and behavioral challenges

ObjectiveThe current study longitudinally examined the moderating effects of family involvement, which previous research has shown to be a protective factor against adolescents' substance use involvement, on the associations between internalizing and externalizing problems, respectively, and substance use (alcohol, marijuana, and tobacco) and problems in a unique sample of adolescents with severe emotional and behavioral problems. MethodAdolescents (n=4786) and their parents were assessed at three waves over a 1-year period as part of the SAMHSA funded Comprehensive Community Mental Health Initiative (CMHI). Multilevel growth curve models were estimated using Hierarchical Linear Modeling (HLM) to examine the associations between time-varying internalizing and externalizing problems, respectively, and substance use involvement over time as a function of family involvement at baseline. ResultsResults supported the hypothesis that family involvement protects against adolescent substance use involvement by buffering the adverse effects of both internalizing and externalizing problems. Specifically, for alcohol use, family involvement buffered the negative effects of high externalizing problems. For tobacco use, family involvement buffered the negative effects of both internalizing and externalizing problems, respectively. For substance use problems, family involvement buffered the effects of only internalizing problems. Family involvement did not moderate effects of emotional and behavioral problems on marijuana use, however, a significant main effect was observed such that family involvement was negatively related to marijuana use. ConclusionsResults suggest that the beneficial effects of family involvement on at-risk adolescents' substance use involvement are dependent on the type of emotional and behavioral problems the adolescent experiences as well as the type of substance the adolescent uses. Implications for family- and adolescent-focused treatment are discussed.

Do family ties shape the performance consequences of diversification? Evidence from the European Union

This paper examines the moderating effect of family involvement in ownership and control on the relationship between diversification strategies – both product and international diversification – and corporate performance. We argue that this moderating effect is related to the distinctive characteristics of family firms compared to non-family firms. The empirical evidence is provided by a sample of firms from the European Union during the 2005–2009 time period. Our results found that family firms are more profitable than non-family firms when they engage in joint product and international diversification.