Study On The Impact Of Internal Succession On The Value Of Chinese Family Business

At the time of the 40 th anniversary of China's reform and opening up,Family enterprises have become an indispensable part of the Chinese private economy,promoting the sustainable and stable development of China's economy.In 2016,"new wealth 500 rich list" data show that China's over 50 years old private entrepreneurs account for 67%,and nearly 70% of Chinese families are looking for successors to transfer.It can be said that with the first generation of entrepreneurs who have entered the sixty years of age,the inheritance of family business in our country has become an unavoidable topic.Whether the family can succeed in inheriting is not only directly related to the business value and sustainable development of family businesses,but also closely related to the overall operation and prosperity of China's private economy.Besides,family businesses have special cultural background and corporate governance.Therefore,it is of great practical significance to study the succession of family businesses.This paper first introduces the background,significance,objectives,methods,contents,technical routes and possible innovation points of this study.The inheritance elements of family business mainly include wealth,power and culture,of which power is the most basic,essential and core element.The heirs of a family business are divided into internal heirs(children,family members)and external heirs(professional managers).From the perspective of our country's inheritance practice,family entrepreneurs in our country generaly choose to transfer to their children or other family members.The inheritance of family business is not only an event,but also a process of inheriting wealth,power and culture from the generation to the two generation.The inheritance of family business is not smooth,and it will have a direct impact on the value of family business.Therefore,the focus of this study is the influence of the power inheritance on the enterprise value within the family business.The inheritance of the internal power of the family enterprise mainly includes three aspects: the management right,the ownership and the control power.In this paper,based on the theory of family business,the research hypothesis is put forward.We select the listed family companies which are defined as family business by the end of 2014 as our sample data,make an empirical analysis of the sample data of three consecutive years from 2014 to 2016,from three dimensions—respectively are management,ownership and control power.We analyze the Impact of Internal Succession on the value of Chinese Family businessThe main conclusions of this paper are as follows: firstly,the influence of inheritance of family business ownership on enterprise value is not significant;secondly,the inheritance of control power in family firm is harmful to improving enterprise value;thirdly,while the inheritance of management partly is beneficial to improving enterprise value,the inheritance of management fully have a negative impact on the enterprise value.In the end,based on the three conclusions,this paper also puts forward the corresponding countermeasures and suggestions for the inheritance of family enterprises.