Governance structure and performance of private family firms

被引:0
作者
Mukherjee T. [1 ]
Swami V. [2 ]
Wang W. [3 ]
机构
[1] University of New Orleans, New Orleans, 70148, LA
[2] IBS Business School, Hyderabad
[3] Department of Finance, Cleveland State University, Cleveland, OH
关键词
Family firms; Financial performance; Governance; Ownership structure;
D O I
10.1007/s12197-018-9466-6
中图分类号
学科分类号
摘要
A debate exists on the issue of whether a governance system is value additive or even necessary for a privately-held firm. One side of the debate suggests that, since agency problems do not exist in a small private firm, it does not need a costly governance system. The other side argues that a private firm indeed faces agency costs in the form of altruism and, therefore, could extract net gains from a governance system. In this paper, we empirically investigate whether a good governance system crates or destroys value of private family firms. We first demonstrate that a multifamily firm encounters larger agency costs stemming from inter-family conflicts, and therefore, has larger incentive than a single-family firm to institute a superior governance system. We then show that a multifamily firm, owing to its better governance system, outperforms its single-family counterpart. © 2019, Academy of Economics and Finance.
引用
收藏
页码:713 / 734
页数:21
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