 Does the CFO matter in family firms? Evidence from ItalyStefano Caselli and Alberta Di Giuli The European Journal of Finance, 2010, vol. 16, issue 5, 381-411 Abstract: Using data from 708 small and medium Italian firms during the period of 2002-2004, we find that in family firms (FFs) a nonfamily Chief Financial Officer (CFO) drives firm performance in a positive direction. FFs with a nonfamily CFO perform better than both FFs with a family CFO and nonfamily firms. The best performance is achieved when the Chief Executive Officer (CEO) is a family member and the CFO is an outsider (nonfamily). An examination of FFs across generations shows that a nonfamily CFO has always a positive effect on firm performance. Our study contributes to the literature on FFs by determining how the presence of a nonfamily CFO has an impact on firm performance. We also contribute to the literature on agency theory by showing that in small FFs: (a) having a family as majority shareholder is not detrimental to firm performance and (b) a nonfamily CFO might serve to mitigate any ineptness of descendant CEOs while retaining ownership and management in the hands of family heirs, thus avoiding the conflict of interest between family ownership and management. Keywords: small business; family firm; CFO; CEO; Italy (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:eurjfi:v:16:y:2010:i:5:p:381-411 Ordering information: This journal article can be ordered from DOI: 10.1080/13518470903211657 Access Statistics for this article The European Journal of Finance is currently edited by Chris Adcock More articles in The European Journal of Finance from Taylor & Francis Journals |
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