Effect of family control on corporate dividend policy of firms in Pakistan

This study examines the impact of family control on the dividend policy of firms in Pakistan,covering the period from 2009 to 2016.It also investigates whether family control moderates the impact of firm-specific factors on the dividend policy.The GMM model for panel data estimation is used.The mean difference univariate analysis shows that family firms differ from nonfamily firms based on financial characteristics.The multivariate analysis shows that family firms pay lower dividends than nonfamily firms.Besides,firm size inversely affects the dividend policy,whereas tangibility positively affects it.Moreover,family control does not moderate the impact of all firm-specific factors on the dividend policy.Overall,family control,size,and tangibility are found to be the main determinants of the dividend policy in Pakistan.

Family involvement, family member composition and firm innovation

Based on the data of Chinese listed family firms from 2008 to 2016,we investigate the impact of family involvement on firm innovation and the moderating effect of family member composition.The results show that increased family involvement significantly reduces R&D investment intensity and the number of patent applications.With the increased richness of the kinship of family members involved in management,the negative impact of family involvement on patent applications is weakened,but family member composition does not have a significant moderating effect on the relationship between family involvement and R&D investment intensity.Further analysis shows that the number of invention patent applications decreases as the degree of family involvement increases,but family involvement has no significant effect on utility model patent and design patent applications.Family member composition has a significant moderating effect on the relationship between family involvement and invention patent applications.The results have value as a reference for exploring how family involvement affects firm innovation and can also help the actual controller to take effective measures to optimize family member composition and improve the innovation performance of family firms.

Non-family chair and corporate performance

Using a sample of Chinese family firms listed from 1999 to 2014, we investigate the relationship between non-family leadership and firm performance. We find that firms with a non-family member as board chair perform significantly worse than firms whose chair belongs to the family. Moreover, we show that the underperformance of nonfamily-chair firms is more pronounced when firms are under weaker outside monitoring and when the controlling families care less about family business longevity. The negative effect of a non-family chair is robust to a variety of endogeneity tests. We also dismiss alternative explanations other than concern for reputation. Overall, our empirical results suggest that the social norms regarding family reputation are important in shaping the controlling shareholders＇ expropriation incentives and firm performance.