Research On The Influence Of Family Control On Corporate Internationalization

As an essential part of the socialist market economy,private economy is playing an increasingly important role in the social and economic development in China.Most of Chinese private enterprises are owned or controlled by families,therefore,family control has an important impact on the corporate decision-making and business behavior.With the change of domestic and international environment,the traditional core competitive advantages of family business,which are low cost and low price,have gradually disappeared,and it is a general trend that private enterprises shift from labor-intensive to knowledge-intensive.If innovation-driven is an important feature of knowledge-intensive enterprises,then internationalization is a crucial way for enterprises to reshape their core competitive advantages and achieve transformation and upgrading.However,internationalization also increases the complexity and uncertainty of enterprise operation,which income and risk are coexisting in.Whether family business can break through the shackles of original development model,cultivate new core competitive advantages and realize transformation and upgrading through international operation is an important topic related to the sustainable development of enterprises,which has gradually attracted the attention of the theoretical circles.Family business is a compound system in which the family and enterprise systems are coupled together.The integration and contradiction of family goals and corporate goals are the unique attributes of family businesses.As an essential leading factor of the corporate internationalization behaviors,the existence of family control makes the enterprises show a series of unique behaviors in the process of internationalization.Through the literature study,it is not difficult to find that the internationalization of family business has become an emerging research field,accumulating a certain amount of research results.However,there are still deficiencies in existing research: Firstly,One-sided view of the relationship between family control and corporate internationalization,falling into the misunderstanding of dualism;Secondly,neglecting the influence of non-economic goal orientation on the internationalization behaviors.Thirdly,the existing research conclusions mainly come from the sample data of enterprises in developed economies,and the applicability to enterprises in emerging economies needs to be verified.On the basis of literature research,this research focuses on the topic of the influence of family control on corporate internationalization,and constructs a theoretical model that can explain the mechanism of the two,and conducts an empirical test to illustrate the relationship between family ownership control,family management control and corporate internationalization,as well as the mechanism of corporate governance structure and institutional environment on this process.By means of mechanism,we can reveal the general law of family business internationalization,enrich theoretical research,provide reference for family business internationalization,and promote the healthy development of private economy.Specifically,the research questions mainly include four aspects: first,the influence of family ownership control on corporate internationalization;second,the influence of family management control on corporate internationalization;third,the influence of corporate governance structure on the relationship between family control and corporate internationalization;and fourth,the influence of institutional environment in the transition period on the relationship between family control and corporate internationalization.Based on the actual situation of the international operation of Chinese private enterprises and the research issues mentioned above,in order to examine the relationship between family control and corporate internationalization behavior,the 9th and 10 th National Private Enterprise Questionnaire Survey Data organized by the National Federation of Industry and Commerce as well as the State Administration for Industry and Commerce is adopted.The main research findings include the following five aspects:(1)The higher the degree of family ownership control,the lower the propensity of the enterprise to internationalize;(2)Under the joint action of risk aversion mechanism and long-term orientation mechanism,the degree of family ownership control and internationalization intensity presents a U-shaped correlation;(3)The family decision-making power control has a negative effect on the internationalization propensity and intensity.The family management right control has a significant negative effect on the internationalization propensity and intensity.The family executive power control has no significant influence on the internationalization propensity,but it has a significant negative correlation with internationalization intensity;(4)When a firm has external corporate shareholder or supervisory board,it can effectively reduce the negative effect of family control on internationalization propensity and internationalization intensity;(5)Family control has a crowding-out effect on the improvement of marketization lever.The promotion of marketization has less positive impact on the family-controlled enterprises' internationalization than that of non-family-controlled enterprises.The political connection of business owners plays a significant role in promoting the internationalization of family-controlled enterprises.When the business owners have political connections,it can relieve the negative effects of family control on the internationalization propensity and internationalization intensity.The innovations of this research can be summarized into three aspects: Firstly,it further clarifies the viewpoint differences between family ownership control and internationalization propensity,and expounds the nonlinear correlation between family ownership control and internationalization intensity from the internal mechanism,enriching the existing research results of the influence of family ownership control on the corporate internationalization behavior.Secondly,based on the unique behavior characteristics of Chinese family business managers,the paper further explores the influence of family decision-making power control,family management power control and family executive power control on the internationalization behavior,and systematically reflects the differential effects of different dimensional management rights control on the internationalization behavior.Finally,the influence of family control on the internationalization behavior has significant situational dependence characteristics.This paper explores the influence of corporate governance structure and institutional environment on the relationship between family control and internationalization behavior,and further clarifies the theoretical boundary of the relationship between family control and corporate internationalization.