New Book on Business Families Research

Walmart, Samsung, Porsche, Tata…Family-owned firms are behind some of the most famous brands in the world. Together, these family businesses contribute most of the global Gross Domestic Product (GDP).

They feature prominently among business researchers, but there is a side yet uncovered.

NUS Business School’s Associate Professor Marleen Dieleman (Department of Strategy and Policy) said, “Most family business research quietly assumes that there is one nuclear family that runs one business. While this situation is true for most family businesses in the West, it does not cover situations far more common in emerging economies.

“Here in Southeast Asia, for instance, most entrepreneurial families have a wide array of firms spanning different industries, which changes the dynamics considerably. Other families have sold the original business and are active investors or philanthropists. So, there may not be a legacy business at all. Moreover, with large multigenerational families, often intermarried, can we still speak of a single family? The intricate dynamics of large groupings linked by kinship ties are still mostly unexplored by family business scholars. Thus, we saw the need to expand the family business literature into the realm of what we call ‘business families’.”

A new book, “De Gruyter Handbook of Business Families”, co-edited by Associate Professor Dieleman and Professor Michael Carney from Concordia University, sets out to “bring the family back to the forefront of family business research”.

Family members’ behaviours matter

There are several takeaways from the book. Associate Professor Dieleman said that family network analysis and psychology could help us understand the behaviours of family members and how these behaviours impact the business. She shared, “For instance, parenting styles and educational choices can affect the entrepreneurial tendencies and resilience of the next generations. Moreover, the roles of submerged family members such as spouses are crucial in managing relational transitions. My colleague Assistant Professor Jamber Li has contributed a fascinating chapter about this topic.”

Governance in elaborate families

The book also delves into the governance of more elaborate families who preside over a wide array of business or charity activities. This often comes with establishing new structures, such as family constitutions and family offices, and the involvement of various external experts. In one of the chapters, NUS Business School’s PhD candidate Lydia Song wrote about the state of the art in family office research. “Scholars are beginning to systematically assess which governance mechanisms prevail in business families and whether these are effective,” added Associate Professor Dieleman.

The effect of business families on society

Business families contribute to economic growth through entrepreneurship. However, the passing on of family wealth is different and typically brings new opportunities and challenges.

Associate Professor Dieleman shared, “The opportunities are that family wealth can be engaged for innovative new businesses, impact investing or other activities that benefit society. But critical scholarly voices also highlight the potential for greater inequality in society through the transfer of unearned wealth. Our book looks at how business families navigate their role and purpose in society across generations.”

After more than a year in the making, the “De Gruyter Handbook of Business Families” presents a global perspective of business families, including those in emerging markets.

But Associate Professor Dieleman’s work continues. She said, “I am very interested in the journeys of Asia’s large business families, so I will continue to work at the intersection of family governance and business strategy. Right now, I am fascinated by the autobiographies of the post-colonial generation of business founders in Malaysia, Indonesia and Singapore. It is interesting to systematically analyse how they reconstruct and narrate their entrepreneurial journeys.”