The Value relevance of accounting performance measures for quoted family firms: A study in the light of the alignment and entrenchment hypotheses

Sami Basly () and Tayeb Saadi
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Sami Basly: CEROS - Centre d'Etudes et de Recherches sur les Organisations et la Stratégie - UPN - Université Paris Nanterre

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Abstract: The present research examines the value relevance of accounting earnings data disclosed by a sample of French family and non-family firms. The major goal of this paper is to find if the value relevance of accounting earnings for investors depends on the nature of the firm. In addition, it intends to check if accounting earnings relevance varies in function of the concentration of ownership in the hands of families. The research is based on a longitudinal data set (2009 – 2012) obtained from a sample of 349 firms quoted on the Paris stock market and composing the CAC-All tradable index. Relying on the association studies' methodology, the main hypotheses are supported as the results show that family firms exhibit more value relevant earnings than non-family firms. This finding could be justified by an alignment effect that may be especially evidenced in the case of moderate family ownership. Conversely, less value relevant earnings are exhibited by highly controlled family firms thus showing evidence for a probable entrenchment by the owning-families.

Date: 2020-12-22
Note: View the original document on HAL open archive server: https://hal.science/hal-03258926
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Published in European Journal of Family Business, 2020, 10 (2), pp.6-23. ⟨10.24310/ejfbejfb.v10i2.7397⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03258926

DOI: 10.24310/ejfbejfb.v10i2.7397

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