Are Founding Families Special Blockholders ? An Investigation of Controlling Shareholder Influence on Firm Performance

Dusan Isakov and Jean-Philippe Weisskopf

No 428, FSES Working Papers from Faculty of Economics and Social Sciences, University of Freiburg/Fribourg Switzerland

Abstract: This paper examines how family and non-family ownership affects the performance of Swiss listed firms from 2003 to 2010. We distinguish between these two types of controlling shareholders since they have different objectives. We hypothesise that only family shareholders have a real incentive to reduce agency costs whereas non-family blockholders are similar to widely held companies. Our results show that family firms are more profitable and sometimes display better market valuations as opposed to companies that are widely held or have a non-family blockholder. We investigate the impact of different features of family firms on performance, and document that the generation of the family, active involvement of the family and contestability of family control play an important role.

Keywords: founding family firm; active management; founder; ownership structure; firm performance; contestability (search for similar items in EconPapers)
JEL-codes: G3 G32 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2012-08-20
New Economics Papers: this item is included in nep-bec, nep-cfn and nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: Are founding families special blockholders? An investigation of controlling shareholder influence on firm performance (2014)
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