How does family governance shape corporate philanthropy? Interaction effects between family ownership and management controls
KeywordCorporate social responsibility
Corporate social contribution
Socio-emotional property perspective
Corporate social responsibility
Socioemotional wealth perspective
MetadataShow full item record
AbstractWe examine the effect of family governance on corporate philanthropy by focusing on the motives of controlling families. We emphasize that controlling families have two different motives, namely, financial and socioemotional motives. On this basis, we argue that the two motives have contrasting effects on corporate philanthropy. Given that family ownership represents the financial motive of family principals, the first hypothesis posits that family ownership is negatively related to corporate philanthropy. Family management increases family visibility and thus encourages controlling families to be concerned with their socioemotional wealth. That is, the higher the visibility of controlling families in the firm, the more likely the overlap will be between family and firm identity. Thus, the second and third hypotheses predict that family involvement in management as a family CEO or director positively moderates the relationship between family ownership and corporate philanthropy. We test our hypotheses using fixed effects panel regression models and the sample of large nonfinancial Korean family firms listed in KOSPI, Korea’s major stock market. Test results support our hypotheses. We find that family firms become reluctant to engage in discretionary wealth transfer to nonfamily stakeholders as family ownership increases. However, this negative effect of family ownership on corporate philanthropy is weakened by family involvement in top management and the board of directors. Our findings reconcile the inconsistent results in the literature on family business and CSR, which is divided into positive and negative perspectives. In this manner, we revisit the assumption of prior research, which often treats family firms as homogeneous and reveals the limitation of a dichotomous approach to family business. We conclude by discussing the implications and theoretical contributions of this study and offering future research directions.
VersionNo full-text in the repository
CitationPark S-B and Kim H (2019) How does family governance shape corporate philanthropy? Interaction effects between family ownership and management controls. Korean Management Review. 48(6): 1591-1623.
Link to publisher’s versionhttps://www.kci.go.kr/kciportal/ci/sereArticleSearch/ciSereArtiView.kci?sereArticleSearchBean.artiId=ART002535612
Showing items related by title, author, creator and subject.
Strategic Planning for Family Business in the Kingdom of Saudi Arabia.Kara-Zaitri, Chakib; Salmon, Sami Taisir (University of BradfordDepartment of Engineering, Design and Technology., 2010-07-06)In this dissertation, the strategic planning process in a family owned firm of Saudi Arabia will be discussed. The main aim is to develop a comprehensive model of strategic planning, specific and customized to the family businesses of Saudi Arabia. The model will encompass all the factors that are unique to the Saudi Arabian family businesses, such as the family culture of Saudi business families, the interfamily dynamics that shape the strategic approach of the family and the unique market conditions or the external environment that influences the strategic planning process of family owned firms in Saudi Arabia. The literature review extensively covers the topic of strategic planning, family business dynamics and major salient features of family business described by various authors. The literature review also discusses the models of family business that define the interaction of various elements in family owned firms, their drawbacks and the gaps in applicability of these documented models to family businesses in general and specificallyt o Saudi Arabian family businessesT. he literaturer eview revealst hat there is no comprehensivem odel of strategicp lanning processf or the family owned firms that highlight all the critical factors that shape the strategic planning process and also documents uccessfufli rms that haveb enefitedf rom thesem odels. Based on an extensive survey of the family owned firms of Saudi Arabia and statistical analysis of various unique features of such firms, the most critical factors that play a major role in strategy formulation could be isolated. These critical factors helped in designing the strategic planning model for the family owned firms of Saudi Arabia. The model was practically implemented and validated in 10 family businesses of the kingdom and results confirm the applicability of this model. The model formulation and validation in the family firms of Saudi Arabia, forms the main focus of this dissertation.
Actualising the `democratic family'? Swedish policy rhetoric versus family practices.Ahlberg, J.; Roman, C.; Duncan, Simon (Oxford University Press, 2008)In this paper we examine empirically a key element of individualisation theory - the democratic family. We do so using the `acid test' of family policy, and family practice, in Sweden. First we review the progress of family policy in Sweden since the 1960s, which has expressly promoted an agenda of gender equality and democracy in families, with individual autonomy for both adults and children as one key element. We then turn to family practice, looking particularly at negotiation and adult equality, lifelong parenting after separation, and children's autonomy. While Swedish policy makers and shapers seem to have developed the idea of the democratic family long before the sociologist Anthony Giddens, the results in practice have been more ambivalent. While there has been change, there is more adaptation to pre-existing gender and generational norms.
Intrafamily Entrepreneurship: The formation and membership of family entrepreneurial teamsDiscua Cruz, A.; Howorth, Carole; Hamilton, E. (2013)Family entrepreneurial teams are groups of related individuals who engage in entrepreneurship. Entrepreneurial teams studies emphasize the resources that members bring to the team. Family business studies suggest that relationships and social theories are important. Social capital explains the formation and composition of family entrepreneurial teams (FETs). Analysis is of case studies of FETs based in Honduras. A shared commitment to entrepreneurial stewardship of the family's assets underpins formation of FETs. Trust and shared values were important for membership. This study highlights that families are not internally consistent, and family ties are not equally strong.