Family firms’ survival in an economic downturn: The role of ownership concentration and collaborative intensity

ABSTRACT

This study examines the key topic of small- and medium-sized enterprise (SME) survival during an economic downturn by focusing on the role of family governance. We argue that family SMEs typically show higher levels of organizational inertia that may particularly harm their performance during an environmental jolt, while other idiosyncrasies, including greater survivability capital and owners’ transgenerational sustainability intentions, enhance their odds of survival. However, we also contend that family firms are a heterogeneous group, and draw attention to the level of ownership concentration and collaborative intensity as factors likely to enhance these firms’ survival. Conversely, we posit that family businesses with lower ownership concentration will benefit more from high collaborative intensity, thus suggesting the need to examine the joint survival effects of these two factors. We performed Cox survival analyses on a sample of 259 SMEs tracked from 2005 to 2019. The results offer important implications for scholars, managers, and policymakers.

KEYWORDS:

• SME survival
• family firms
• economic downturn
• ownership concentration
• collaborative intensity

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ The Anuari Català d’Indústria, Comerç, Serveis i Administració (ACICSA) is a dataset that includes all exporters in the autonomous community of Catalonia (Spain).

² National Institute of Statistics, http://www.ine.es/. Statistics represent corporate insolvency filings, which include both liquidations and reorganizations.

³ SABI is provided by Bureau Van Dijk and Informa. It includes complete information and financial data from official sources, such as the stock exchange, the press, and company registers, and therefore has a high degree of reliability.

⁴ These models are available on request from the authors.