PATTERNS OF OWNERSHIP AND GOVERNANCE IN FAMILY FIRMS. INSIGHT FROM UPPER ECHELONS AND ORGANIZATIONAL THEORY

As family business scholars, we are often encouraged to improve our theorizing to develop more interesting hypotheses and improve our understanding for family entrepreneurship, management and governance. But these exhortations are more easily said than done. Current research, considers family businesses from the same perspective as dispersed and anonymously held business, with the added feature that they are privately held businesses characterized by concentrated ownership and owner‐manager duality. Such perspective risks ignoring important matters that occur when the family is involved in the business. Specifically, there is a need of a framework that could describe and explain the mechanisms underlying the family effect on business entrepreneurship (Dyer, 2006), management and governance. That is what we attempt to accomplish in this paper by introducing the study of the family as a group and by examining the application of group processes in the context of family business in order to explain the patterns of ownership and governance. Specifically, our paper tries to extend the understanding of the influence of the family on the family business by examining the role of the family as a dynamic group in the family firm ownership and governance. Our theoretical perspective refers to the upper echelons theory.