When Does the Family Govern the Family Firm?

When Does the Family Govern the Family Firm?

Øyvind Bøhren, Bogdan Stacescu, Line Almli, Kathrine Sondergaard

Series number :

Serial Number: 

Date posted :

July 13 2018

Last revised :

July 30 2018
SSRN Share


  • Corporate governance • 
  • family firms • 
  • private benefits • 
  • Endogeneity • 
  • self-selection

We find that the controlling family holds both the chief executive officer and chair positions in 79% of Norwegian family firms. The family holds more governance positions when it owns large stakes in small, profitable, low-risk firms. This result suggests that the family trades off expected costs and benefits by conditioning participation intensity on observable firm characteristics.

We find that the positive effect of performance on participation is twice as strong as the positive effect of participation on performance. The endogeneity of participation should therefore be carefully accounted for when analyzing the effect of family governance on the family firm’s behavior.

Published in

Published in: 
Publication Title: 
Journal of Financial and Quantitative Analysis
13 July 2018. Federal ID: 91-6001537 ISSN: 0022-1090 (Print), 1756-6916 (Online)


Real name:
Line Almli
Real name:
Kathrine Sondergaard