Professionalization of Family Business and Performance Effect
- 9 September 2013
- journal article
- research article
- Published by SAGE Publications in Family Business Review
- Vol. 27 (4), 346-364
- https://doi.org/10.1177/0894486513482971
Abstract
This study seeks to understand the governance of post–initial public offering (IPO) family firms and its impact on performance. Using an analysis of a balanced panel data set of 205 publicly listed firms in Taiwan spanning 10 years (2,050 firm-years), we found that extensive family control has a negative impact on the post-IPO performance and that nonfamily block shareholders may divest their stockholdings in these firms to protect their investments. To sustain equity support from their block shareholders, post-IPO family firms should combine the use of family control with professional management in their corporate governance structure.Keywords
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