Family Involvement And Private Firm Risk Taking Level

On the one hand,Private enterprises have become an important driving force for Chinese economic development after China's reform and opening up policy,and family firms are the main of chinese private enterprises,so to analyze family firms' economic behavior have important guiding significance for understanding the development of Chinese private enterprises and even China's economic and social transformation.Family members deeply involved in strategic decision making and daily management is an important feature of family firms.Economic effects of family intervention study to become an important cut perspective for researching family firms behavior.on the other hand,from the theoretical development perspective,the current trends of theoretical study on family firms are concerned about the family's socioemotional wealth(socioeomtional wealth,referred to SEW)(Gomez-Mejia,et al.,2011)how to influence family firms behavior.But document is not yet analyze the relationship between family intervention and the Chinese family firm risk-taking from socioemotional wealth perspective.Based on the above background,the theory of socioemotional wealth as a guide in this paper,the paper by researching the relationship between family intervention and the Chinese family firms ' s risk to deeper understanding family firms economic behavior under the background of China's transition.Firstly,related research literature about the family firms,firm risk taking and socioemotional wealth theory are reviewed and commented in this paper.Secondly,the theory of socioemotional wealth as a guide in this paper,and the paper use theory to analyze the theoretical mechanism about the relationship between family intervention and family firm risk taking level.Then the paper put forward the hypothesis.Finally,the paper with China's listed family firms as a sample,the time span from 2003 to 2014.And then the paper use relevant quantitative analysis method to empirical test and analyze the hypothesis about relationship between family intervention and family firm risk taking.Theoretical and empirical results of this paper show:(1)From the perspective of socioemotional wealth,family firm and non-family firm have significant differences in the level of risk taking,and family firm risk level significantly lower than non-family firm.(2)From the perspective of socioemotional wealth,family intervention and family firm risk-taking having a negative correlation.With the family deeper degree ofintervention,the lower the level of firm risk.In particular,when the paper use the proportion of family ownership,the proportion of family members of the Board and the executive team to represent the family intervention,got the following results: First,the higher the percentage of ownership held by the family,the lower the risk level of the family firm.Second,family members accounted for the higher proportion of the Board,the lower the risk level of the family firm.Third,the higher the proportion of corporate executive team members of the family,the lower the risk level of the family firm.(3)Company size has a positive regulatory role to the relationship between family intervention and family firm risk.This means that with the expansion of business scale,the negative correlation between family involvement and level of firm risk will decrease.The innovation of this paper is mainly reflected in the following areas: First,this paper is link family firm and firm risk-taking two areas of study by researching family firm risk issues.And contributed to the family firm and firm risk and interdisciplinary research.Second,the paper analyze the relationship between family intervention and family firm risk level from socioemotional wealth perspective,this further expanding the theory of family firm and provides a new theoretical explanations and empirical test to family firm.Finally,The paper linked to socioemotional wealth and family firm risk level,it enriches the content and scope of application of socioemotional wealth theory.