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International expansion of family firms: the moderating role of successors and external managers

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  • Mariasole Bannò
  • Sandro Trento

Abstract

Internationalisation is a key to productivity, profitability, innovation and growth, especially for family firms (FFs). This paper provides new evidence of the relationship between FFs' features and their international growth. Through socioemotional wealth, it investigates how family impacts a multinational firm's degree of internationalisation. Accordingly, it examines whether family affects the strategic decision to expand abroad through foreign direct investments. The sample comprises 361 Italian multinational companies affiliated with 5,348 foreign firms in the period 1994-2013. Given the continuous nature of the dependent variable, the degree of internationalisation, we adopt a multiple linear regression model. Family involvement in ownership is negatively associated with internationalisation, while governance has no effect. In contrast, the presence of young successors favours internationalisation. Moreover, the negative effect of family ownership is enhanced for firms with no external managers, and yet the negative effect of family ownership on internationalisation is lower for firms without successors.

Suggested Citation

  • Mariasole Bannò & Sandro Trento, 2016. "International expansion of family firms: the moderating role of successors and external managers," International Journal of Globalisation and Small Business, Inderscience Enterprises Ltd, vol. 8(4), pages 292-315.
    • Handle: RePEc:ids:ijgsbu:v:8:y:2016:i:4:p:292-315
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    Cited by:

    1. Mariasole Bannò & Giorgia Maria D’Allura & Graziano Coller & Celeste Varum, 2023. "Men are from Mars, women are from Venus: on lenders’ stereotypical views and the implications for a firm’s debt," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 27(2), pages 651-687, June.
    2. Jean-Luc Arregle & Francesco Chirico & Liena Kano & Sumit K. Kundu & Antonio Majocchi & William S. Schulze, 2021. "Family firm internationalization: Past research and an agenda for the future," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 52(6), pages 1159-1198, August.
    3. Metsola, Jaakko & Leppäaho, Tanja & Paavilainen-Mäntymäki, Eriikka & Plakoyiannaki, Emmanuella, 2020. "Process in family business internationalisation: The state of the art and ways forward," International Business Review, Elsevier, vol. 29(2).

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