Ethical correlates of family control: Socioemotional wealth, environmental performance and financial returns Articles uri icon

publication date

  • February 2025

start page

  • 1

end page

  • 25

International Standard Serial Number (ISSN)

  • 0167-4544

Electronic International Standard Serial Number (EISSN)

  • 1573-0697

abstract

  • We examine and test the environmental performance of family firms across 22 European countries and find that they exhibit better environmental performance than nonfamily firms. This result confirms prior research conducted in the United States. More specifically, we conclude that family firms engage in more substantive environmental actions than nonfamily firms. Furthermore, we hypothesize and confirm that family firms do not pay a financial price for lower emissions, which should facilitate the voluntary, non-instrumental adoption of pollution control practices. Finally, we also find that the relationship between substantive environmental activities and financial returns is stronger among family firms that have family members on the board and are under the influence of the first generation.

subjects

  • Business
  • Economics

keywords

  • board of directors; family frm; financial returns; generation; substantive environmental actions; socioemotional wealth