Attracting nonfamily applicants to the family firm: A signaling theory approach

ABSTRACT

Encouraging nonfamily applicants to join the family firm is a challenging yet necessary task to ensure firm growth and survival. We draw from signaling theory to examine applicant perceptions of two family firm signals: corporate social responsibility and long-term orientation. Using an experimental study, we investigate whether family firm signals are related to nonfamily applicants’ willingness to join family firms. Results indicate that socially responsible activities are associated with positive applicant perceptions of company reputation and that long-term orientation is associated with applicant perceptions of job security. Taken together, our findings suggest that nonfamily applicants’ perceptions and willingness to join a family firm are shaped by specific signals in the recruitment process.

KEYWORDS:

• Nonfamily employee recruitment
• corporate social responsibility
• long-term orientation
• signaling theory
• willingness to join

Disclosure statement

No potential conflict of interest was reported by the authors.