Founding-family-controlled firms, intergenerational succession, and firm value

Figures & data

Table 1. Distribution of founding family and non-founding-family firms by industrial sector.

NAICS Sector	Non-Founding-Family Firms	Founding-Family Firms	Total
Accommodation and Food Services	2	1	3
	1.75	2.17	1.88
Administrative and Support and Waste Management and Remediation Services	1	0	1
	0.88	0.00	0.63
Agriculture, Forestry, Fishing, and Hunting	5	7	12
	4.39	15.22	7.50
Arts, Entertainment, and Recreation	11	1	12
	9.65	2.17	7.50
Construction	4	5	9
	3.51	10.87	5.63
Health Care and Social Assistance	2	0	2
	1.75	0.00	1.25
Information	5	0	5
	4.39	0.00	3.13
Manufacturing	42	14	56
	36.84	30.43	35.00
Mining, Quarrying, and Oil and Gas Extraction	2	2	4
	1.75	4.35	2.50
Other Services (except Public Administration)	1	0	1
	0.88	0.00	0.63
Professional, Scientific, and Technical Services	0	3	3
	0.00	6.52	1.88
Retail Trade	6	6	12
	5.26	13.04	7.50
Transportation and Warehousing	8	5	13
	7.02	10.87	8.13
Utilities	24	1	25
	21.05	2.17	15.63
Wholesale Trade	1	1	2
	0.88	2.17	1.25
Total	114	46	160
	100.00	100.00	100.00

This table shows the number of companies, broken down by industrial classification, and the division between founding-family and non-founding-family businesses. The first row shows frequencies, while the second row shows percentages.

Source: Authors' calculations.

Table 2. Variables’ definitions.

Variable	Description	Definition
VALUE1	Tobin’s Q	(Market capitalisation + total debt) / book value of total assets
VALUE2	Tobin’s Q	(Market capitalisation + total liabilities) / book value of total assets
VALUE3	Adjusted Tobin’s Q	VALUE1 adjusted by the average of the industrial sector and year
VALUE4	Ln of VALUE1	Natural logarithm of VALUE1
VALUE5	Ln of VALUE2	Natural logarithm of VALUE2
FOUNDFAM	Founding family	Dummy variable that takes a value of 1 if the firm is controlled by a founding family and 0 otherwise
OWNFOUNDFAM	Family ownership	Ownership by the founding family
FOUND	CEO/chairman founder	Dummy variable that takes a value of 1 if the founder is the CEO or chairman of the board, and 0 otherwise
DESC	CEO/chairman family	Dummy variable that takes a value of 1 if a descendant of the founding family holds the position of CEO or chairman of the board, and 0 otherwise.
BUSGROUP	Business group	Dummy variable that takes a value of 1 if the firm belongs to a business group, and 0 otherwise
FAM	Family	Dummy variable that takes a value of 1 if the firm is controlled by one or more families and 0 otherwise
SIZE	Firm size	Natural-logarithmic transformation of firm’s book value of total assets
LEV	Leverage	Total debt / book value of total assets
ROA	Profitability	Net income / book value of total assets
TANG	Assets’ tangibility	Net property, plant, and equipment / book value of total assets
RISK	Altman’s Z-score	$1.2\frac{\mathit{Working} \mathit{capital}}{\mathit{Total} \mathit{assets}}+1.4\frac{\mathit{Retained} \mathit{earnings}}{\mathit{Total} \mathit{assets}} +3.3\frac{\mathit{EBITDA}}{\mathit{Total} \mathit{assets}}+0.6\frac{\mathit{Market} \mathit{capitalization}}{\mathit{Total} \mathit{liabilities}}+\frac{\mathit{Sales}}{\mathit{Total} \mathit{assets}}$
CAPEX	Capital expenditure	Capital expenditures / book value of total assets
OWN	Ownership concentration	Ownership by the majority shareholder
PFOWN	Pension funds’ ownership	Ownership by pension funds
REP	Reputation	Natural-logarithmic transformation of years since company foundation
BGD	Board gender diversity	Blau index

Source: Authors' calculations.

Table 3. Descriptive statistics.

Variable	Mean	Std. Dev.	Min	Max	FOUNDFAM	No FOUNDFAM	Mean-Difference Test
VALUE1	1.092	1.187	0.024	8.665	0.892	1.181	−0.289	***
VALUE2	1.353	1.196	0.175	9.003	1.153	1.442	−0.288	***
VALUE3	−0.020	0.960	−2.568	7.428	−0.095	0.014	−0.109	**
VALUE4	−0.185	0.709	−3.732	2.159	−0.286	−0.140	−0.147	***
VALUE5	0.133	0.512	−1.744	2.198	0.043	0.172	−0.129	***
FOUNDFAM	0.295	0.456	0.000	1.000	1.000	0.000	1.000	***
OWNFOUNDFAM	0.202	0.315	0.000	1.000	0.659	0.000	0.659	***
FOUND	0.106	0.308	0.000	1.000	0.346	0.000	0.346	***
DESC	0.146	0.353	0.000	1.000	0.477	0.000	0.477	***
BUSGROUP	0.650	0.477	0.000	1.000	0.535	0.700	−0.165	***
FAM	0.602	0.490	0.000	1.000	1.000	0.426	0.574	***
SIZE	12.915	1.999	5.871	17.966	13.007	12.874	0.133
LEV	0.222	0.154	0.000	0.594	0.246	0.212	0.035	***
ROA	0.044	0.091	−0.331	0.502	0.034	0.049	−0.015	***
TANG	0.455	0.243	0.000	0.996	0.359	0.497	−0.138	***
RISK	3.376	4.918	−0.225	32.936	2.765	3.647	−0.882	***
CAPEX	0.052	0.046	0.000	0.256	0.045	0.054	−0.009	***
OWN	0.490	0.229	0.001	1.000	0.461	0.503	−0.042	***
PFOWN	0.037	0.061	0.000	0.250	0.031	0.040	−0.009	***
REP (years)	56.102	36.247	0.696	163.397	42.559	62.093	−19.534	***
BGD	0.063	0.121	0.000	0.490	0.084	0.053	0.031	***

This table presents the mean, standard deviation, and minimum and maximum for each of the variables. A test of differences in means for each of the variables is presented, distinguishing between the results for founding-family and non-founding-family firms. Five metrics are used for company value. $\mathit{VALUE}1$ is defined as the equity-market value plus total debt over the total value of assets (Tobin’s Q). $\mathit{VALUE}2$ is defined as the equity-market value plus total liabilities over the total value of assets (Tobin’s Q). $\mathit{VALUE}3$ is calculated as an adjusted measure of Tobin's Q (adjusted by the average of the industrial sector and year). $\mathit{VALUE}4$ is the natural logarithm of $\mathit{VALUE}1.$ $\mathit{VALUE}5$ is the natural logarithm of $\mathit{VALUE}2.$ $\mathit{FOUNDFAM}$ is a dummy variable that takes a value of 1 if the firm is controlled by a founding family and 0 otherwise. $\mathit{OWNFOUNDFAM}$ indicates the ownership percentage of the founding family.$\mathit{FOUND}$ is a dummy that takes a value of 1 if the founder serves as CEO or chairman of the board, and 0 otherwise. $\mathit{DESC}$ is a dummy that takes a value of 1 if a descendant of the founder serves as CEO or chairman of the board. BUSGROUP is a dummy variable that takes a value of 1 if the firm belongs to a business group. FAM is a dummy variable that takes a value of 1 if the firm is controlled by one or more families and 0 otherwise. Control variables are also included, such as the size of the company $\left(\mathit{SIZE}\right),$ indebtedness $\left(\mathit{LEV}\right),$ profitability $\left(\mathit{ROA}\right),$ tangibility $\left(\mathit{TANG}\right),$ risk $\left(Z\right),$ growth opportunities $\left(\mathit{CAPEX}\right),$ ownership concentration $\left(\mathit{OWN}\right),$ pension funds’ ownership $\left(\mathit{PFOWN}\right),$ reputation $\left(\mathit{REP}\right),$ and board gender diversity (BGD). *** indicates statistical significance at 1%, ** at 5%, and * at 10%.

Source: Authors' calculations.

Table 4. Correlation matrix.

	Variables	1	2	3	4	5	6	7	8	9	10	11	12	13	14	15	16	17	18	19	20
1	VALUE1	1.000
2	VALUE2	0.992***	1.000
3	VALUE3	0.789***	0.785***	1.000
4	VALUE4	0.776***	0.741***	0.678***	1.000
5	VALUE5	0.848***	0.865***	0.744***	0.880***	1.000
6	FOUNDFAM	−0.112***	−0.111***	−0.0525*	−0.0955***	−0.116***	1.000
7	OWNFOUNDFAM	−0.116***	−0.114***	−0.0646**	−0.111***	−0.128***	0.964***	1.000
8	FOUND	−0.045	−0.0457*	−0.018	−0.0686**	−0.0751**	0.518***	0.492***	1.000
9	DESC	−0.0703**	−0.0659**	−0.038	−0.028	−0.034	0.622***	0.608***	0.0505*	1.000
10	BUSGROUP	−0.0876***	−0.0876***	−0.013	−0.021	−0.028	−0.160***	−0.132***	−0.0581*	−0.149***	1.000
11	FAM	−0.193***	−0.198***	−0.0755***	−0.188***	−0.190***	0.541***	0.522***	0.280***	0.337***	0.000	1.000
12	SIZE	−0.250***	−0.233***	−0.0565*	−0.008	−0.009	0.031	0.038	−0.022	0.043	0.424***	0.0710**	1.000
13	LEV	−0.0756***	−0.0875***	0.031	0.139***	0.0565*	0.104***	0.0674**	−0.021	0.172***	0.010	0.006	0.376***	1.000
14	ROA	0.364***	0.358***	0.195***	0.341***	0.352***	−0.0737**	−0.0624**	−0.030	−0.0833***	0.116***	−0.104***	0.038	−0.206***	1.000
15	TANG	0.0836***	0.0693**	0.037	0.120***	0.0844***	−0.261***	−0.233***	−0.220***	−0.0696**	0.121***	−0.228***	−0.0703**	0.0487*	0.012	1.000
16	RISK	0.647***	0.618***	0.393***	0.447***	0.434***	−0.0827***	−0.0648**	0.003	−0.108***	−0.0691**	−0.0898***	−0.354***	−0.381***	0.250***	0.011	1.000
17	CAPEX	0.0696**	0.0731**	0.0586*	0.172***	0.175***	−0.0891***	−0.0656**	−0.044	−0.003	0.032	−0.0523*	0.0496*	0.123***	0.0917***	0.229***	−0.0782***	1.000
18	OWN	−0.125***	−0.124***	−0.026	−0.0907***	−0.0943***	−0.0842***	−0.015	−0.019	−0.0931***	0.231***	−0.0571*	0.139***	−0.140***	0.0590*	0.0727**	−0.0465*	−0.006	1.000
19	PFOWN	−0.016	−0.022	0.018	0.123***	0.0884***	−0.0677**	−0.0966***	0.006	−0.0605**	0.240***	−0.038	0.446***	0.222***	0.011	0.015	−0.101***	0.102***	−0.0675**	1.000
20	REP	0.002	−0.001	0.044	0.035	0.033	−0.212***	−0.213***	−0.247***	−0.001	−0.031	0.163***	0.163***	0.027	−0.005	0.041	−0.0456*	−0.042	−0.0681**	0.147***	1.000
21	BGD	0.026	0.021	−0.022	0.010	−0.016	0.119***	0.127***	0.112***	0.112***	−0.0880***	−0.0457*	−0.033	0.039	−0.036	0.039	−0.034	−0.0594**	−0.0691**	0.025	−0.043

This table presents the correlations between the variables previously defined. Five metrics are used for company value. $\mathit{VALUE}1$ is defined as the equity-market value plus total debt over the total value of assets (Tobin’s Q). $\mathit{VALUE}2$ is defined as the equity-market value plus total liabilities over the total value of assets (Tobin’s Q). $\mathit{VALUE}3$ is calculated as an adjusted measure of Tobin's Q (adjusted by the average of the industrial sector and year). $\mathit{VALUE}4$ is the natural logarithm of $\mathit{VALUE}1.$ $\mathit{VALUE}5$ is the natural logarithm of $\mathit{VALUE}2.$ $\mathit{FOUNDFAM}$ is a dummy variable that takes a value of 1 if the firm is controlled by the founding family and 0 otherwise. $\mathit{OWNFOUNDFAM}$ indicates the ownership percentage of the founding family.$\mathit{FOUND}$ is a dummy that takes a value of 1 if the founder serves as CEO or chairman of the board, and 0 otherwise. $\mathit{DESC}$ is a dummy that takes a value of 1 if a descendant of the founder serves as CEO or chairman of the board. BUSGROUP is a dummy variable that takes a value of 1 if the firm belongs to a business group. FAM is a dummy variable that takes a value of 1 if the firm is controlled by one or more families and 0 otherwise. Control variables are also included, such as the size of the company $\left(\mathit{SIZE}\right),$ indebtedness $\left(\mathit{LEV}\right),$ profitability $\left(\mathit{ROA}\right),$ tangibility $\left(\mathit{TANG}\right),$ risk $\left(Z\right),$ growth opportunities $\left(\mathit{CAPEX}\right),$ ownership concentration $\left(\mathit{OWN}\right),$ pension funds’ ownership $\left(\mathit{PFOWN}\right),$ reputation $\left(\mathit{REP}\right),$ and board gender diversity $\left(\mathit{BGD}\right).$ *** indicates statistical significance at 1%, ** at 5%, and * at 10%, respectively.

Source: Authors' calculations.

Table 5. Family firm and performance.

VARIABLES	(1)	(2)	(3)	(4)	(5)
	VALUE1	VALUE2	VALUE3	VALUE4	VALUE5
OWNFOUNDFAM	3.1938***	4.0598***	3.8738***	2.1437***	2.1440***
	(9.8040)	(12.1751)	(15.6146)	(8.0599)	(8.2872)
OWNFOUNDFAM2	−4.0622***	−5.2151***	−4.7318***	−2.9082***	−2.8164***
	(-9.1659)	(-11.8247)	(-15.5724)	(-9.2105)	(-8.9067)
Extreme Point OWNFOUNDFAM	0.3931***	0.3892**	0.4093***	0.3686***	0.3806***
OWN	−9.6788***	−9.8634***	−10.7438***	−4.8936***	−3.1143***
	(-27.2556)	(-25.6948)	(-30.6358)	(-18.1766)	(-17.5479)
OWN2	8.0838***	8.3598***	9.2794***	4.3389***	2.7201***
	(23.3639)	(23.6054)	(29.4836)	(18.3213)	(18.7975)
Extreme Point OWN	0.5987***	0.5899***	0.5789***	0.5639***	0.5725***
BUSGROUP	−0.0088	−0.0639	0.0082	−0.5064***	−0.3780***
	(-0.2102)	(-1.3442)	(0.2499)	(-13.9064)	(-12.3276)
SIZE	−0.1479***	−0.1276***	−0.1490***	−0.0290***	0.0005
	(-14.4594)	(-9.4734)	(-13.7330)	(-2.6382)	(0.0609)
LEV	1.4450***	1.0692***	1.6310***	1.6096***	0.5360***
	(33.8862)	(25.1519)	(35.8140)	(25.7294)	(24.5536)
ROA	1.0563***	0.9537***	0.7995***	0.8984***	0.5724***
	(14.6226)	(16.2153)	(11.9842)	(14.7182)	(13.4174)
TANG	−0.8356***	−0.9844***	−0.9950***	−0.1108**	−0.2082***
	(-10.3061)	(-12.7451)	(-16.9795)	(-2.4745)	(-3.7146)
RISK	0.0767***	0.0647***	0.0577***	0.0483***	0.0212***
	(41.8782)	(45.5646)	(36.2143)	(55.4783)	(29.1539)
CAPEX	2.1391***	2.5541***	2.0144***	1.6420***	1.3898***
	(11.7712)	(14.3189)	(10.8483)	(11.5414)	(12.1300)
PFOWN	3.9230***	3.9248***	2.3977***	3.2139***	2.2987***
	(12.2971)	(10.8467)	(8.3159)	(10.6741)	(9.8358)
REP	0.1416***	0.1619***	0.2058***	−0.0434	0.0020
	(5.7562)	(7.8152)	(8.6998)	(-1.3971)	(0.1458)
BGD	−0.6700***	−0.8835***	−0.2719***	−0.7686***	−0.7339***
	(-7.9235)	(-11.0094)	(-3.7447)	(-12.6523)	(-17.0644)
Intercept	4.4387***	4.6898***	3.5044***	1.1607***	0.9987***
	(20.3196)	(19.9723)	(17.2981)	(6.9011)	(7.1811)
Observations	1,901	1,901	1,901	1,901	1,901
Year FE	YES	YES	YES	YES	YES
Industry FE	YES	YES	YES	YES	YES
AR(2)	1.907	1.686	1.154	3.794	3.864
Hansen	130.3	136.3	131.3	147.2	142
F-test	9712***	16008***	5395***	1023***	579.4***
Lind-Mehlum OWNFOUNDFAM	8.43	11.34	14.35	8.06	8.29
Lind-Mehlum OWN	17.43	18.56	25.89	16.08	17.08

The coefficients (t-statistics) arise from the regressions of panel data estimated by means of generalised method of moments. The variables used are previously defined. *** indicates statistical significance at 1%, ** at 5%, and * at 10%.

Source: Authors' calculations.

Table 6. Family firm and performance.

	(1)	(2)	(3)	(4)	(5)
VARIABLES	VALUE1	VALUE2	VALUE3	VALUE4	VALUE5
OWNFOUNDFAM	3.0005***	3.6399***	3.7463***	2.5922***	2.1471***
	(10.1789)	(12.9672)	(11.8946)	(10.1646)	(11.2014)
OWNFOUNDFAM2	−4.1344***	−4.7878***	−4.8273***	−3.2749***	−2.7660***
	(-10.0214)	(-13.4727)	(-12.5800)	(-10.8688)	(-11.5337)
Extreme Point OWNFOUNDFAM	0.3629***	0.3801***	0.3880***	0.3958***	0.3881***
OWN	−10.4566***	−10.4954***	−11.7183***	−5.0923***	−3.3954***
	(-32.5006)	(-27.1688)	(-27.2589)	(-17.9605)	(-18.1405)
OWN2	8.9186***	8.7815***	10.1917***	4.5691***	2.9759***
	(29.5450)	(23.5870)	(26.3847)	(18.4305)	(18.6704)
Extreme Point OWN	0.5862***	0.5976***	0.5749***	0.5572***	0.5705***
FAM	0.2206***	0.1353**	0.2344***	−0.0279	−0.0108
	(3.2469)	(2.0368)	(3.4941)	(-0.4184)	(-0.2169)
SIZE	−0.1576***	−0.1329***	−0.1451***	−0.0524***	−0.0131*
	(-12.2965)	(-11.3524)	(-13.2789)	(-6.3930)	(-1.7301)
LEV	1.4865***	1.0932***	1.6589***	1.6680***	0.5776***
	(36.0909)	(33.3407)	(44.1198)	(29.0036)	(19.9073)
ROA	0.9517***	0.9485***	0.7698***	0.8878***	0.4516***
	(11.6205)	(14.8305)	(11.9558)	(16.0785)	(12.7937)
TANG	−1.0156***	−1.0096***	−1.0372***	−0.1001**	−0.2115***
	(-11.5406)	(-11.0015)	(-14.4040)	(-2.3519)	(-4.1950)
RISK	0.0730***	0.0626***	0.0562***	0.0475***	0.0198***
	(45.2939)	(33.3855)	(31.3617)	(49.2329)	(36.0522)
CAPEX	2.5328***	2.5036***	2.1232***	2.0498***	1.6352***
	(11.6690)	(13.1375)	(12.1222)	(16.7230)	(17.3354)
PFOWN	4.1727***	3.7245***	2.3879***	2.6492***	1.9392***
	(13.0187)	(11.8016)	(7.5661)	(9.7070)	(9.0711)
REP	0.1160***	0.1292***	0.1485***	−0.0468*	0.0175
	(3.7294)	(5.2503)	(6.1770)	(-1.7576)	(1.4338)
BGD	−0.7156***	−0.7848***	−0.1014	−0.6107***	−0.5677***
	(-8.7574)	(-9.2496)	(-1.3716)	(-10.1797)	(-12.5340)
Intercept	4.6907***	4.8964***	3.7630***	1.0392***	0.8640***
	(23.1699)	(20.9143)	(16.2843)	(6.6426)	(6.1531)
Observations	1,901	1,901	1,901	1,901	1,901
Year FE	YES	YES	YES	YES	YES
Industry FE	YES	YES	YES	YES	YES
AR(2)	2.016	1.720	1.244	3.705	3.959
Hansen	130	138.7	130.1	144.9	140.4
F-test	4289***	6341***	4351***	1984***	2276***
Lind-Mehlum OWNFOUNDFAM	9.47	12.61	11.89	10.16	11.17
Lind-Mehlum OWN	23.10	17.85	23.55	17.25	15.60

The coefficients (t-statistics) arise from the regressions of panel data estimated by means of generalised method of moments from equation (1)(1) $$\mathit{VALUE}=\alpha +{\beta }_1{\mathit{OWNFOUNDFAM}}_{it}+{\beta }_2{X}_{it}+{\epsilon }_{it}$$(1) . The variables are previously defined. *** indicates statistical significance at 1%, ** at 5%, and * at 10%.

Source: Authors' calculations.

Table 7. Impact of the founder’s and descendant’s presence on firm value.

	(1)	(2)	(3)	(4)	(5)	(6)
VARIABLES	VALUE1	VALUE2	VALUE3	VALUE1	VALUE2	VALUE3
FOUND	0.6301***	0.6478***	0.5668***
	−6.8786	−7.1689	−7.9749
DESC				−0.1974***	−0.1665**	−0.2802***
				(-2.7043)	(-2.2979)	(-4.2810)
OWN	−10.0194***	−9.9147***	−10.4200***	−10.3059***	−10.1789***	−11.3106***
	(-27.9340)	(-25.1989)	(-27.8647)	(-30.4757)	(-25.3042)	(-27.6259)
OWN2	8.4097***	8.1354***	8.7619***	8.5400***	8.3765***	9.6532***
	−25.4877	−21.7686	−24.4238	−30.1887	−23.2475	−28.6137
Extreme Point OWN	0.5957***	0.6094***	0.5946***	0.6034***	0.6076***	0.5858***
FAM	0.0385	−0.0856	0.0773	0.2039***	0.1217*	0.2084***
	−0.6533	(-1.3827)	−1.405	−3.451	−1.9309	−3.0751
SIZE	−0.1616***	−0.1329***	−0.1260***	−0.1638***	−0.1449***	−0.1395***
	(-16.8080)	(-12.4111)	(-11.4319)	(-17.6575)	(-12.0509)	(-13.6555)
LEV	1.7558***	1.3970***	1.8845***	1.6846***	1.3699***	1.8670***
	−38.8121	−36.4139	−47.6744	−44.6943	−37.9109	−51.2997
ROA	1.1442***	1.1071***	0.8749***	1.1925***	1.1427***	0.9801***
	−20.3315	−25.6114	−12.693	−17.7189	−19.1861	−14.821
TANG	−0.8659***	−0.9067***	−1.0599***	−0.8643***	−0.9255***	−1.0983***
	(-11.2292)	(-13.3898)	(-19.7626)	(-11.9195)	(-14.1432)	(-15.1182)
RISK	0.0763***	0.0661***	0.0599***	0.0725***	0.0625***	0.0585***
	−42.8483	−36.2557	−45.3567	−42.0162	−31.7234	−43.5266
CAPEX	2.0855***	2.1655***	1.8874***	1.9582***	2.3722***	2.0749***
	−11.0324	−13.3716	−11.0789	−9.5493	−12.6886	−13.9181
PFOWN	2.9274***	2.1610***	1.4084***	3.7018***	2.7716***	2.2890***
	−7.8079	−6.071	−4.5118	−9.9482	−7.4475	−7.1038
REP	0.2203***	0.2170***	0.2485***	0.1746***	0.2142***	0.2152***
	−8.0315	−10.7972	−12.1771	−5.7218	−8.1686	−7.4597
BGD	−1.0984***	−1.2900***	−0.4846***	−1.0816***	−1.2542***	−0.4714***
	(-12.5243)	(-20.0031)	(-5.8495)	(-14.6274)	(-14.9530)	(-7.4205)
Intercept	4.1238***	4.3652***	2.9646***	4.4633***	4.6460***	3.5246***
	−21.6469	−20.8109	−16.4585	−19.6322	−20.4672	−13.8822
Observations	1901	1901	1901	1901	1901	1901
Year FE	YES	YES	YES	YES	YES	YES
Industry FE	YES	YES	YES	YES	YES	YES
AR(2)	2.323	2.104	1.681	2.038	1.858	1.342
Hansen	133.5	136.4	130.5	131.4	132	141.2
F-test	7132***	30426***	2307***	14012***	31698***	9845***
Lind-Mehlum OWN	21.02	16.53	19.56	26.36	19.33	22.67

The coefficients (t-statistics) arise from the regressions of panel data estimated by means of generalised method of moments from equation (2)(2) $$\mathit{VALUE}=\alpha +{\beta }_{1}F\mathit{OUND}/\mathit{DESC}+{\beta }_2{X}_{it}+{\epsilon }_{it}$$(2) . The variables are previously defined. *** indicates statistical significance at 1%, ** at 5%, and * at 10%.

Source: Authors' calculations.

Table 8. Combined impact of the founding-family variables on firm value.

	(1)	(2)	(3)	(4)	(5)	(6)
VARIABLES	VALUE1	VALUE2	VALUE3	VALUE1	VALUE2	VALUE3
FOUND	0.6286***	0.6815***	0.4517***
	(5.3658)	(7.7433)	(6.7439)
DESC				−0.3294***	−0.3862***	−0.3666***
				(-4.2884)	(-4.6018)	(-4.9381)
OWNFOUNDFAM	2.0260***	3.0986***	3.1708***	3.7786***	4.4335***	4.5873***
	(6.0572)	(9.0022)	(7.5741)	(10.3639)	(10.7046)	(12.5450)
OWNFOUNDFAM2	−2.8153***	−4.2357***	−4.4570***	−4.5869***	−5.4597***	−5.5663***
	(-6.5041)	(-9.4527)	(-8.8569)	(-10.7370)	(-11.2273)	(-13.2266)
Extreme Point OWNFOUNDFAM	0.3598***	0.3658***	0.3557***	0.4119***	0.4060***	0.4121***
OWN	−10.3230***	−10.0529***	−11.4991***	−10.4274***	−10.4279***	−11.4351***
	(-27.4751)	(-22.3067)	(-24.6995)	(-28.5416)	(-25.8344)	(-27.2678)
OWN2	8.7613***	8.5406***	9.9437***	8.9325***	8.8371***	10.0363***
	(26.0537)	(20.2151)	(22.9229)	(24.7623)	(23.1680)	(25.5852)
Extreme Point OWN	0.5891***	0.5885***	0.5782***	0.5837***	0.5900***	0.5697***
FAM	0.1271	0.0094	0.1418*	0.1490**	0.0635	0.2135***
	(1.5800)	(0.1127)	(1.7358)	(2.2629)	(1.0370)	(3.2733)
SIZE	−0.1467***	−0.1281***	−0.1308***	−0.1587***	−0.1308***	−0.1555***
	(-13.6524)	(-10.0648)	(-10.1019)	(-13.1230)	(-10.5077)	(-17.5991)
LEV	1.6128***	1.2806***	1.7423***	1.6335***	1.2416***	1.8315***
	(33.3225)	(30.0391)	(41.7811)	(38.3012)	(34.3956)	(40.4840)
ROA	1.0669***	0.9676***	0.7342***	1.0955***	0.9912***	0.6946***
	(15.1805)	(16.5816)	(9.9180)	(14.8478)	(16.6485)	(10.2038)
TANG	−0.8627***	−1.0672***	−1.0703***	−0.9294***	−0.9963***	−0.9972***
	(-9.8755)	(-12.7465)	(-16.3757)	(-10.2561)	(-10.7330)	(-17.4626)
RISK	0.0749***	0.0636***	0.0544***	0.0726***	0.0632***	0.0550***
	(33.6286)	(30.1270)	(28.6089)	(35.2146)	(34.4770)	(30.8467)
CAPEX	2.0968***	2.5189***	1.9338***	2.4743***	2.6492***	2.0403***
	(10.3080)	(12.8958)	(14.3798)	(11.6414)	(12.6341)	(14.4129)
PFOWN	3.1640***	2.8085***	1.8037***	3.6883***	3.6481***	2.1678***
	(6.8444)	(6.9108)	(5.3627)	(9.6019)	(10.4826)	(6.3359)
REP	0.1724***	0.2132***	0.1871***	0.1906***	0.1985***	0.1741***
	(6.9853)	(11.1803)	(7.0214)	(6.6021)	(8.6806)	(6.9567)
BGD	−0.8725***	−1.1589***	−0.3755***	−0.8893***	−0.9580***	−0.2675***
	(-7.5541)	(-13.2849)	(-5.4856)	(-9.6959)	(-10.4320)	(-4.7532)
Intercept	4.2639***	4.3677***	3.6222***	4.2536***	4.4848***	3.5460***
	(17.5637)	(18.3664)	(13.2549)	(20.0636)	(18.6595)	(16.8417)
Observations	1,901	1,901	1,901	1,901	1,901	1,901
Year FE	YES	YES	YES	YES	YES	YES
Industry FE	YES	YES	YES	YES	YES	YES
AR(2)	2.328	2.236	1.597	2.304	2.072	1.577
Hansen	133.5	133.1	128.6	129.8	137.7	123.6
F-test	6173***	29130***	3600***	8188***	8310***	1579***
Lind-Mehlum OWNFOUNDFAM	6.06	9.00	7.57	10.36	10.70	12.55
Lind-Mehlum OWN	20.76	16.07	19.36	19.30	17.54	21.71

The coefficients (t-statistics) arise from the regressions of panel data estimated by means of generalised method of moments from equation (2)(2) $$\mathit{VALUE}=\alpha +{\beta }_{1}F\mathit{OUND}/\mathit{DESC}+{\beta }_2{X}_{it}+{\epsilon }_{it}$$(2) . The variables are previously defined. *** indicates statistical significance at 1%, ** at 5%, and * at 10%.

Source: Authors' calculations.