Succession planning in family firms: family governance practices, board of directors, and emotions

Abstract

This study builds on implementation intention theory to indicate that both business and family governance practices influence the succession planning process in family firms. In addition, this study draws on goal adjustment theory to explore whether the family CEO's emotions, being his or her inability to let go of the family firm, hamper the governance decisions of the board of directors concerning that succession planning process. Applying a moderated mediation analysis on a sample of 225 family firms, results show that board involvement in the succession process mediates the positive relationship between the use of family governance practices and the level of succession planning. In addition, the family CEO's inability to let go negatively moderates this mediating relationship which signifies that emotions influence governance outcomes in family firms.

Family governance systems: the complementary role of constitutions and councils

“…The family governance structure contributes to creating a favourable organisational environment (Chirico et al, 2011;Sirmon et al, 2008). In such an environment, the family business can benefit from the interactions and ties between family members that are necessary to take advantage of the rich, diverse endowment of knowledge, relationships and competencies that a complex family offers (Brenes et al, 2011;Umans et al, 2020). Considering these findings, Hypothesis 5 is proposed as follows:…”

Sucessão em Empresas Familiares: Um Olhar a partir do Conceito de Conatus

“…Otherwise, there may be contradictions related to the commitment of the future successor that, many times, only takes over the family business due to the lack of other working options or due to parents' demands (Parker, 2016). The succession plan must be linked to the commitment of predecessors and successors to the family business, as well as to the ability to pass it on to future generations (Gilding, Gregory, & Cosson, 2015;Umans, Lybaert, Steijvers, & Voordeckers, 2020). Blumentritt (2016) points out that successors are generally pressured to choose the same career developed by their parents.…”

Burma Drinx Group (A): Strategizing for CEO Succession in a Family Business

“…Some of the material relates to an Asian context . CEO’s succession in a family business is a crucial and complicated event critical for the success of the firm (Luan et al, 2018; Richards et al, 2019). Umans et al (2018) state that only a third of the successions in family businesses seem to be successful. Succession is definitively a challenge complicated by the dynamics within the family-business system (Bozer et al, 2017).…”