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Sten K. Johnson Centre for Entrepreneurship

Lund University School of Economics and Management

Asymmetric voting right = bad for the family company

Published: 2018-03-27

Multiple blockholder structures and family firm performance

A recent study on "Multiple Blockholder Structures and Family Firm Performance" has been published in the scholarly journal Entrepreneurship Theory and Practice (ETP). Asma Fattoum-Guedri (Copenhagen Business School), Zied Guedri (EMLYON) and our own Frédéric Delmar from Sten K. Johnson Centre for Entrepreneurship are behind the study.

The study investigates how minority ownership of non-family members affects the family business's board work and ability to perform. The literature has different perspectives on how ownership structures affect the family business performance. Minority ownership can either be a useful control function or an obstacle to realizing the family business strategy.

The authors suggest that an asymmetric allocation of voting rights between family and non-family owners has a negative impact on the company. Furthermore, the authors suggest that this negative effect of asymmetry is further enhanced by an increasing number of ownership groups. The authors find empirical support for their proposals when analyzing data from French public introductions of family businesses during the period 1992-2012.

The study was first published on December 21st 2017.