Successors’ discretion and corporate restructuring in family firms in South Korea: from an institutional perspective

ABSTRACT

Although a successor’s discretion is a key factor in facilitating corporate restructuring, little is known about the source of discretion, particularly about national culture. From an institutional perspective, we argue that when a successor is legitimized by the norms and expectations embedded in national culture, the successor is likely to implement corporate restructuring. Using data of family-run business groups in South Korea, where Confucianism is a dominant value system, we find that when a successor is the first-born child and male in the family, the business group is likely to spin-off, and this effect becomes stronger with the number of siblings.

KEYWORDS:

• Business group
• Confucianism
• corporate restructuring
• discretion
• family business
• succession
• South Korea

Disclosure statement

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

Additional information

Notes on contributors

JungYun Han

JungYun Han, Assistant Professor at National Taiwan University, works on family business and firm strategy. She published papers at Academy of Management Journal and European Journal of Innovation Management. She received a PhD degree from INSEAD.