The Succession Of Family Business、social Capital Of Board And Firm Performance

Family business is one of the most common forms of enterprise organization in the world, which plays an important role in our economy. With the growth of the first generation of age and the development of the times, succession has become a major problem for many family companies to solve. Succession has great influence on enterprise’s strategy risk, firm performance and development. But without a succession plan, the wrong transfer time and the lack of succession will of heirs can cause the succession fail. In this view, the smooth succession depends not only on the individual’s efforts, but also on the company’s overall coordination. The board of directors, as the company’s power and business decision-making body, their decision will affect the enterprise development strategy and the fate of a firm. Therefore, in the entire process of succession, the board has played a huge role. And from the function of the board, its social capital is the premise of the board to provide resources, but also the important factor between the succession and corporate performance.To sum up, this paper is based on principal-agent theory and resource dependence theory, and 286 listed family companies as the research object from 2011 to 2013, which explores the relationship between the succession and firm performance and the adjustment effect of the social capital of the board. In this paper, the succession of family business is divided into two stages based on the process view, which are the participation of management and the reception of management. Respectively, this research will study the relationship between the different stages and firm performance. Secondly, social capital is divided into three dimensions, namely, political capital, financial capital and other social capital, and I will analyze the adjustment of the social capital of the board in the relationship between the different stages of family business and corporate performance.The study found that family business two generation of management and corporate performance is significantly positive correlation, and family business two generation of receiving management and enterprise performance is significantly negative correlation. On this basis, political capital has a significant positive moderating effect on the relationship between the two stages of family business and firm performance, and financial capital has a significant positive moderating effect on the relationship between the participation of management and firm performance, and the adjustment of the reception of management and firm performance is not significant. In addition, the study found that the adjustment of other social capital is not significant in the succession stages.The research conclusion of this paper has certain guiding significance to improve the governance structure of the board, the different stages of succession and the promotion of enterprise performance.