Business groups and their types

Abstract

Business groups, Diversification, Family-ownership, Theory of the firm,

Business Group Performance, Context, and Strategy: A Meta-Analysis.

“…Historical accounts tell us that their emergence and early establishment often occurred under very difficult institutional conditions and that they played a pivotal role in the early stages of many a country or region's economic development (Carney & Gedajlovic, 2002;Gerlach, 1992;Keister, 1998). These descriptions indicate that BGs are complex social and economic phenomena serving diverse purposes (Cuervo-Cazurra, 2006;Yiu et al, 2007). As a result, BGs are likely to have multiple, conflicting, and complementary effects on their host societies and the firms that affiliate with them.…”

Export Behavior and Board Independence in Colombian Family Firms: The Reverse Causality Relationship

“…Studies investigating the internationalization process of family firms have focused mainly on firms from developed markets (Calabro et al, 2013;Mitter et al, 2014;Zahra, 2003). It is also important to note that emerging economies have a greater proportion of family firms in comparison to developed countries and have greatly increased their international operations in the past few years (Cuervo-Cazurra, 2006;Ramamurti and Singh, 2009). Although there are examples of family firms from emerging economies that are largely internationalized, the average family-controlled firms from emerging markets are still poorly developed internationally (Bhaumik et al, 2010).…”

“…Scholars have studied family firms' internationalization process and the determinants that trigger that process (Claver, Rienda, & Quer, 2009;Fernádez & Nieto, 2005;Gallo & Pont, 1996;Graves & Thomas, 2004, 2006Segaro, 2010;Thomas & Graves, 2005), however there's still a dearth of research on how family ownership and management changes affect these firms' propensity to become exporters, especially in the context emerging economies.…”

Does Family Business Group Affiliation In Real Sector Firms Really Affect Their Performance?

“…Despite the fact that the definition of a business group changes widely from one country to another, a business group can generally be defined as an organization where a family or individual can usually own a large number of member firms and be involved in their top management and/or board of directors. They also control them through pyramidal structures (La Porta et al, 1999;Cuervo-Cazurra, 2006;Claessens et al, 2006;Almeida and Wolfenzon, 2006;Gonenc and Hermes, 2008;Chang and Hong, 2000;among others). As Cuervo-Cazurra (2006) emphasizes, it is possible to mention three types of business groups according to their ownership structure.…”

“…As for possible costs of group affiliation, the fact that control is concentrated in the hands of dominant shareholders could lead to another agency issue between dominant and minority shareholders because of the expropriation effect (La Porta et al, 1999;Cuervo-Cazurra, 2006 overinvestment hypothesis (Jensen, 1986), managers of group firms having higher free cash flows may tend to invest in projects with low-profit potential (Ferris et al, 2003). Thirdly, based on profit stability hypothesis, business groups may attach particular importance to the stability of profits instead of profit maximization for ensuring their survival (Ferris et al, 2003).…”