Influence of family-centered goals on dividend policy in family firms: A socioemotional wealth approach

María Belda-Ruiz (), Gregorio Sánchez-Marín () and J. Samuel Baixauli-Soler ()
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María Belda-Ruiz: University of Murcia
Gregorio Sánchez-Marín: University of Alcala
J. Samuel Baixauli-Soler: University of Murcia

International Entrepreneurship and Management Journal, 2022, vol. 18, issue 4, No 6, 1503-1526

Abstract: Abstract Socioemotional wealth (SEW) preservation is likely to be a key determinant for family firms when shaping their dividend policy. This paper analyzes how family-centered goals reflected by SEW can influence dividend policy in private family firms and explores how family involvement in management, generational stage, and firm hazard might moderate these relationships. Results indicate a negative association between SEW preservation and both the likelihood of giving dividends and the amount of dividend paid. This negative relationship is stronger when the CEO is a family member, in early generational stages and when the firm faces greater performance hazard. The amount of dividend paid is also lower when there are family members in other top management positions apart from the CEO. The evidence provided thus suggests that the existing heterogeneity in dividend policy in privately held family firms is strongly driven by differences in SEW priorities.

Keywords: Socioemotional wealth; Family-centered goals; Dividend policy; Family involvement; Family firms (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1007/s11365-021-00741-x

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