Family Involvement and Agency Cost Control Mechanisms in Family Small and Medium-Sized Enterprises

Lucrezia Songini, Luca Gnan

Research output: Contribution to journalArticlepeer-review

Abstract

Family firms may experience different agency conflicts to the classical principal-agent conflict, which arise depending on the varying extent of family involvement. Agency cost control mechanisms should be introduced to cope with them. The paper focuses on family involvement, in governance (FIG) and in management (FIM), agency cost control mechanisms, and financial performance in family SMEs. The results show that FIG is negatively related to agency cost control mechanisms, but they are positively related to FIM, Finally, the importance of agency cost control mechanisms positively influences the financial performance. Hypotheses were tested using LISREL.

Original languageEnglish
Pages (from-to)748-779
Number of pages32
JournalJournal of Small Business Management
Volume53
Issue number3
DOIs
Publication statusPublished - 1 Jul 2015

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