Performance below aspirations as an antecedent of succession planning in family firms

Subtitle:the relationship between socioemotional and financial wealth

This study builds on the behavioral theory of the firm to indicate that firm performance below aspirations affects the level of succession planning in family firms. Moreover, by integrating signaling theory and behavioral agency theory, it shows that the effect of firm performance below aspirations on succession planning decisions is contingent on the focus on the renewal of family bonds through dynastic succession. Based on a sample of 215 family firms, results reveal that when firm performance declines further below aspirations, the level of succession planning increases. Furthermore, results indicate that when the family firm highly focuses on the goal of renewing family bonds through dynastic succession, the aforementioned relationship is even stronger.

Publication year:2019

Keywords:P1 Proceeding

BOF-keylabel:yes

Accessibility:Closed