Entrepreneurial orientation and firm performance in family SMEs: the moderating effects of family, women, and strategic involvement in the board of directors

Abstract

Entrepreneurial success in family SMEs is largely determined by the knowledge, skills, and new ideas contributed by board directors, the most important actors in the formulation of corporate strategy and decision making. The composition of family SME boards has traditionally been homogeneous, as such boards usually comprise male family members. Boards' contributions, however, depend on their level of diversity and strategic involvement. This study analyzes the moderating effects of two main sources of board diversity in family firms, family involvement level and gender diversity, as potential means of enhancing family firms' success when exploiting entrepreneurial initiatives. This study also explores whether these two potential moderators depend on the strategic involvement of the board directors. Based on a sample of 230 Spanish family firms, we found that the link between entrepreneurial orientation and performance is stronger in firms with lower levels of family involvement and higher levels of gender diversity in the board. Moreover, the board's high strategic involvement may strengthen the positive impact of gender diversity and change the moderating influence of family involvement from negative to positive.

Real earnings management and corporate governance: a study of Latin America

“…The power distribution inside the firm depends on the dynamics within the board of directors (Arzubiaga et al, 2018). Hence, independent directors who are supposed to be unbiased concerning inside interests, and the role played by female board members, or the presence of directors representing pension funds, financial institutions, or other institutional investors, can have influential consequences on the corporate governance of Latin American firms, and ultimately, in the discretionary managerial decision-making power regarding the quality of earnings.…”

We survived this! What managers could learn from SMEs who successfully navigated the Greek economic crisis

“…Moreover, research within a services sector context, manifested that EO affects business performance only in small and not in large companies (Núñez-Pomar, Prado-Gascó, Sanz, Hervás, & Moreno, 2016). Nonetheless, in small family businesses the relationship between EO and business performance is stronger when there are lower levels of family involvement in the company's board of directors (Arzubiaga, Iturralde, Maseda, & Kotlar, 2018). In addition, studies have shown the positive impact of EO on SME's performance when the SME becomes active in international markets (see Chew, 2018).…”

Women directors and exporting activity: The moderating role of network advice

“…In this paper, we focus on SME directors, who are responsible for the internationalization strategy of the firm, (Rivas et al, 2009;Rivas et al, 2012;Arzubiaga et al, 2018) and following recent studies (e.g., Pergelova et al, 2018) we examine potential gender differences in exporting activity of the firms. To do so, we draw on the Resource Based View (RBV) and Resource Dependency Theory (RDT), which are well-established frameworks that are used to explain the internationalization of SMEs (Pfeffer & Salancik, 1978;Duran & Jordan, 2012;Laufs & Schwens, 2014).…”