The relationship between the board of directors and firm performance in private family firms: A test of the demographic versus behavioral approach
- 3 June 2015
- journal article
- research article
- Published by Cambridge University Press (CUP) in Journal of Management & Organization
- Vol. 21 (4), 411-435
- https://doi.org/10.1017/jmo.2015.23
Abstract
Research on corporate governance has attempted to investigate the added value of boards of directors through the lenses of both demographic and behavioral approaches. However, investigations into these two approaches, and the subsequent implications for firm performance, have thus far been mainly decoupled from one another. Therefore, the aim of this paper is to put both approaches to the test in the family business context. Using a sample of 567 Spanish family firms, we find that although both approaches can explain the performance of family firms, the behavioral approach explains a much higher proportion of the variation in the firm’s performance. Furthermore, our findings support our hypotheses that the relationship between the proportion of outside directors and firm performance follows an inverted U-shape in private family firms, and that both business-oriented and family-oriented board role performance are positively related with firm performance.Keywords
This publication has 122 references indexed in Scilit:
- Non-linear effects of family sources of power on performanceJournal of Business Research, 2013
- CEO's empathy and salience of socioemotional wealth in family SMEs – The moderating role of external directorsEntrepreneurship & Regional Development, 2013
- Socioemotional Wealth in Family FirmsFamily Business Review, 2012
- The Cognitive Legitimacy of the Family Business FieldFamily Business Review, 2011
- Board Team Leadership Revisited: A Conceptual Model of Shared Leadership in the BoardroomJournal of Business Ethics, 2011
- The Bind that Ties: Socioemotional Wealth Preservation in Family FirmsAcademy of Management Annals, 2011
- Board task performance: An exploration of micro‐ and macro‐level determinants of board effectivenessJournal of Organizational Behavior, 2011
- CEO Regulatory Foci, Environmental Dynamism, and Small Firm PerformanceJournal of Small Business Management, 2010
- A Thematic Analysis of Cultural Variations in Family Businesses: The CASE ProjectFamily Business Review, 2010
- The impact of goal alignment on board composition and board size in family businessesJournal of Business Research, 2007