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Family Business and Sustainable Development: Describing and Analyzing the Family Business Sustainability Posture

A special issue of Sustainability (ISSN 2071-1050). This special issue belongs to the section "Economic and Business Aspects of Sustainability".

Deadline for manuscript submissions: closed (30 June 2021) | Viewed by 18281

Special Issue Editor


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Guest Editor
Department of Business Administration, University of Valencia, Valencia, Spain
Interests: Family Business; Non-Financial Reporting; Social and Regional Development; Value Innovation; Configurational Approach.

Special Issue Information

Dear Colleagues,

Sustainability has become a key issue to develop modern business models and ensure continuous and viable relationships between firms and their environment, in order to create value, as well as to maintain success over time. The theoretical frameworks such as Economy for the Common Good; CSR or Sustainable Regional Development; transnational commitments such as Sustainable Development Goals—SDG; or practices such as non-financial reporting have become part of the ongoing debate among both management practitioners and academics.

Today, research focuses mainly on supranational organizations, government entities, institutions and large companies; however, there are fewer studies addressing small and medium-sized enterprises (SMEs). Moreover, research on other types of organizations, such as family business, has been scarce with only a few exceptions [1–4].

Consistent with the dominance of family businesses in the economic landscape around the world—two-thirds of all businesses around the world generate around 70–90% of annual global GDP and create 50–80% of employment (Family Firm Institute, 2017). Accordingly, it is important to gain specific knowledge about the ‘family business sustainability posture’—FBSP 1. That is the specific and differentiated strategic focus of the family business toward sustainability, depending on how the owner family understands the breadth and scope of its responsibility towards sustainability, their willingness to commit to such issues, as well as their ability to contribute 2.

Given that this issue is in its infancy, a wide range of research focus, theoretical frameworks, and methodologies are welcome. Some, though not all, of the potential topics of interest are:

  • The relationship between the models of owner family and the FBSP;
  • Different approaches to sustainability related decisions and practices depending on family business economic and context;
  • Sustainability across generations: How different family generations perceive sustainability and related responsibility;
  • The interactions among family performance dimensions, business performance dimensions, and the adoption of sustainability practices, including non-financial reporting;
  • With regard to methodologies, both qualitative and quantitative methods are welcome, such as the types and configurations such as fQCA, LPA, cluster analysis, and any other method conducive to better understanding family business as a complex system.

The goal of this special issue is to unleash a fruitful dialogue among researchers around the world with different perspectives and approaches, by using different methodologies, and developing an enriching collaboration among the authors, reviewers, and editors, in order to produce relevant papers for both the academic and practitioner communities.

Hence, the focus of this Special Issue is on the issues related with how the family business face the sustainability challenges: their specific mindsets, intentions, role assignments, internal as well external interactions, and their preferred sustainability practices.

1 Family Business Sustainability Posture. Authors consider that this can be a fruitful translation of the ‘family firm innovation posture’ recently proposed by Rondi, De Massis and Kotlar [5]

2 The willingness-ability paradox, proposed by Chrisman et al [6] to analyze the specific way family business innovate, also can be a promising approach to analyze the specific way the owner family faces questions related to sustainability. Is there such paradox? Maybe in a different way? Is owner-family prone to develop sustainability? Do the families and their businesses have the ability to do so?

Reference

  1. Bakoğlu, R.; Yıldırım, O.B.A. The Role of Sustainability in Long Term Survival of Family Business: Henokiens Revisited. Procedia - Soc. Behav. Sci. 2016, 235, 788–796.
  2. Le Breton-Miller, I.; Miller, D. Family firms and practices of sustainability: A contingency view. Fam. Bus. Strat. 2016, 7, 26–33.
  3. López-Pérez, M.E.; Melero-Polo, I.; Vázquez-Carrasco, R.; Cambra-Fierro, J.J. Sustainability and Business Outcomes in the Context of SMEs: Comparing Family Firms vs. Non-Family Firms. 2018, 10, 4080.
  4. Memili, E.; Fang, H. “Chevy”; Koç, B.; Yildirim-Öktem, Özlem; Sonmez, S. Sustainability practices of family firms: the interplay between family ownership and long-term orientation. Sustain. Tour. 2017, 26, 9–28.
  5. Rondi, E.; De Massis, A.; Kotlar, J. Unlocking innovation potential: A typology of family business innovation postures and the critical role of the family system. Fam. Bus. Strat. 2019, 10, 100236.
  6. Chrisman, J.J.; Chua, J.H.; De Massis, A.; Frattini, F.; Wright, M.; Chua, J.H. The Ability and Willingness Paradox in Family Firm Innovation. Prod. Innov. Manag. 2014, 32, 310–318.

Dr. Tomas Gonzalez Cruz
Guest Editor

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Sustainability is an international peer-reviewed open access semimonthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 2400 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • Family business sustainability posture
  • Family business sustainability practices
  • Owner family–family business fit
  • Family business ‘willingness-ability paradox’
  • Family business non-financial reporting
  • Family business sustainable workplace practices
  • Family business community engagement
  • Family business stakeholder engagement
  • Family business and regional development
  • Family business and corporate social responsibility
  • Family business behavior under critical situations: environmental, human, and economic crises

Published Papers (6 papers)

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Research

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20 pages, 665 KiB  
Article
The Dark Side of Managing for the Long Run: Examining When Family Firms Create Value
by Kyuho Jin, Joowon Lee and Sung Min Hong
Sustainability 2021, 13(7), 3776; https://0-doi-org.brum.beds.ac.uk/10.3390/su13073776 - 29 Mar 2021
Cited by 6 | Viewed by 2417
Abstract
Family firms take a substantial fraction of economic activities and significantly influence a nation’s economic sustainability. Despite the considerable amount of research efforts to determine their performance implications, there is still a lack of consensus. This study aims to address this dissensus in [...] Read more.
Family firms take a substantial fraction of economic activities and significantly influence a nation’s economic sustainability. Despite the considerable amount of research efforts to determine their performance implications, there is still a lack of consensus. This study aims to address this dissensus in two ways. Theory-wise, we introduce two interdependent contingencies that interactively determine the relative strength of positive and negative effects of family involvement: inside chief executive officers (CEOs) and business fluctuations. Method-wise, we employ an advanced econometric technique, the system generalized method of moments (GMM) estimator, to control for endogeneity. Using panel data of Korean family firms listed on the Korea Composite Stock Price Index (KOSPI) stock market during the periods between 2013 and 2016, we find (1) that family firms underperform non-family firms, (2) that the negative effect of family involvement decreases under the management of inside CEOs, and (3) that this positive moderation effect of inside CEOs decreases in the face of business fluctuations. This study furthers our understanding of how the family influences firm performance and, eventually, economic sustainability. Full article
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13 pages, 677 KiB  
Article
Corporate Social Responsibility and Family Business in the Time of COVID-19: Changing Strategy?
by Elena Rivo-López, Mónica Villanueva-Villar, Miguel Michinel-Álvarez and Francisco Reyes-Santías
Sustainability 2021, 13(4), 2041; https://0-doi-org.brum.beds.ac.uk/10.3390/su13042041 - 14 Feb 2021
Cited by 22 | Viewed by 5078
Abstract
Companies in general and family businesses in particular engage in local collaborations in rather diverse areas through their corporate social responsibility activities. The COVID-19 pandemic has made these contributions to community improvement more apparent, suggesting a paradigm shift. This conceptual paper proposes a [...] Read more.
Companies in general and family businesses in particular engage in local collaborations in rather diverse areas through their corporate social responsibility activities. The COVID-19 pandemic has made these contributions to community improvement more apparent, suggesting a paradigm shift. This conceptual paper proposes a reflection about the evolution of the corporate social responsibility activities linked to family businesses in emergencies and from the socioemotional wealth perspective. The contribution of this paper is twofold. Firstly, it provides an in-depth reflection on the evolution of philanthropy, posing the following questions: are we witnessing a reinvention of corporate social responsibility within the framework of family businesses because of the global pandemic; does this new trend deserve support, given the fundamental role that family businesses have played in this situation; and if so, what should such support consist of, and what is the optimal channel for articulating it? Secondly, the paper proposes a theoretical framework from the socioemotional wealth perspective to advance research about corporate social responsibility carried out by family businesses. Business families are more likely to implement strategies that promote ethical behavior and CSR activities in their companies. The pandemic situation has created new possibilities for developing CSR. Full article
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17 pages, 1071 KiB  
Article
Environmental and Social Goals in Spanish SMEs: The Moderating Effect of Family Influence
by Alvaro Rojas and Daniel Lorenzo
Sustainability 2021, 13(4), 1998; https://0-doi-org.brum.beds.ac.uk/10.3390/su13041998 - 12 Feb 2021
Cited by 2 | Viewed by 1896
Abstract
Small and medium-sized enterprises (SMEs) are the predominant form of firm in the economy worldwide, so it is becoming increasingly important to understand the role they play in the green transition. It is urgent to understand how SMEs establish their goals that reorient [...] Read more.
Small and medium-sized enterprises (SMEs) are the predominant form of firm in the economy worldwide, so it is becoming increasingly important to understand the role they play in the green transition. It is urgent to understand how SMEs establish their goals that reorient their strategies and activities towards the creation of greater environmental value. From a stakeholder perspective, this study analyzes the environmental and social goals that create value in SMEs. We identify family influence as an important determinant for the establishment of environmental goals in SMEs that has not been sufficiently studied. We tested the hypotheses in a sample of 132 Spanish SMEs. Our findings indicate that setting social goals and having family characteristics have a direct positive effect on the environmental goals of SMEs. In addition, family influence positively moderates the effect of social goals, increasing its effect in the establishment of environmental goals for the creation of value in SMEs. This is due to the desire of family SMEs to increase their socio-emotional wealth and their transgenerational intention by incorporating the requirements of stakeholders. These findings highlight the importance of particularly considering the family characteristics of SMEs when analyzing the role that SMEs play in the green transition and should also be important for policy makers when designing environmental policies. Full article
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16 pages, 309 KiB  
Article
Sustainability Practices in Australian Firms: The Effect of Family Control and the Generational Stage
by Carlos Fernández-Méndez and Rubén Arrondo-García
Sustainability 2021, 13(3), 1244; https://0-doi-org.brum.beds.ac.uk/10.3390/su13031244 - 25 Jan 2021
Cited by 2 | Viewed by 1968
Abstract
This paper examines the effects of family control on a firm’s adoption of sustainability practices, with special attention given to the heterogeneity of the family business derived from the generational stage of the company. Using a panel of 166 Australian companies listed between [...] Read more.
This paper examines the effects of family control on a firm’s adoption of sustainability practices, with special attention given to the heterogeneity of the family business derived from the generational stage of the company. Using a panel of 166 Australian companies listed between 2011 and 2018, we found that family businesses have lower sustainability scores compared to non-family businesses, according to the predictions of the socioemotional wealth (SEW) approach. For a subsample of family businesses, we found that multi-generational family businesses score better on sustainability than firms managed by the founders (first-generation). The SEW perspective could explain the effects of family control based on the pursuit of non-economic goals and the higher risk-aversion of family businesses. The decline in non-economic goals resulting from the ageing of the company stimulates the adoption of better sustainability practices. The generational stage of a family business could be a moderator of the relationship between family control and the adoption of sustainability practices and is a central element in explaining the disparity in the sustainability policies within family businesses. Full article
17 pages, 399 KiB  
Article
Parents’ Learning Mechanisms for Family Firm Succession: An Empirical Analysis in Spain through the Lens of the Dynamic Capabilities Approach
by Natalia Martin-Cruz, Ismael Barros Contreras, Juan Hernangómez Barahona and Héctor Pérez Fernández
Sustainability 2020, 12(19), 8220; https://0-doi-org.brum.beds.ac.uk/10.3390/su12198220 - 06 Oct 2020
Cited by 6 | Viewed by 2385
Abstract
Succession is a concern for most family firms. The literature has addressed succession in family firms from different perspectives. However, there are still unaddressed questions concerning the microfoundations of succession, and there is a need to secure a better understanding of the succession [...] Read more.
Succession is a concern for most family firms. The literature has addressed succession in family firms from different perspectives. However, there are still unaddressed questions concerning the microfoundations of succession, and there is a need to secure a better understanding of the succession process and what role parents play therein. Using the dynamic capabilities approach, we shed light on the influence of parents’ behaviors on successors’ intentions. In particular, the paper pursues a twofold aim; first, to analyze the effect of learning mechanisms that parents deliberately use with their children in the family firm on the succession dynamic capability; and second, to explore the impact of this dynamic capability of successor intention to continue in the family firm. We test the model on a sample of potential successors of family firms in Spain. Using partial least squares (PLS) for a sample of 9146 individuals, we confirm the positive impact of the use of parents’ deliberate learning mechanisms on succession dynamic capability and, in turn, the positive effect of the created succession dynamic capability on the successor’s intention to continue the family firm. Furthermore, we find that perceived self-efficacy fails to have any effect on successor intention. Full article
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Review

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15 pages, 556 KiB  
Review
Toward an Understanding of Family Business Sustainability: A Network-Based Systematic Review
by He Soung Ahn, EuiBeom Jeong and Hyejin Cho
Sustainability 2021, 13(1), 5; https://0-doi-org.brum.beds.ac.uk/10.3390/su13010005 - 22 Dec 2020
Cited by 5 | Viewed by 3048
Abstract
Family business governance is an important issue for the sustainable development of economies worldwide due to its economic contribution. This review aims to offer a systematic overview of how prior studies explore the issue of family involvement within the broader corporate governance literature. [...] Read more.
Family business governance is an important issue for the sustainable development of economies worldwide due to its economic contribution. This review aims to offer a systematic overview of how prior studies explore the issue of family involvement within the broader corporate governance literature. By adopting a network-based perspective to visualize the research stream, this study provides meaningful insight into the key topics investigated, the patterns in the connections between critical papers, and the key players building the literature. Specifically, this paper makes three major contributions. First, our systematic review based on network analysis of keywords, citations, and authors enhances the understanding of how research on family involvement in the corporate governance literature is interconnected. Second, a large and extensive pool of corporate governance research on family involvement (947 papers) is employed to encompass research on family involvement from various academic disciplines under the umbrella of corporate governance. Third, by providing answers to questions such as “which journals should I read?”, “which keywords should I look for?”, “who are the leading scholars?”, “which journals are scholars publishing in?” and “what are emerging research trends?”, this study offers valuable implications for future research and meaningful guidelines for future studies in the field. Full article
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