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Family ownership and environmental performance: The mediation effect of human resource practices

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  • Lorenzo Dal Maso
  • Rodrigo Basco
  • Thomas Bassetti
  • Nicola Lattanzi

Abstract

Previous literature has found that listed family firms underperform their nonfamily counterparts in terms of environmental performance, but has not explained why this occurs. We address this research gap by hypothesizing that training and development practices (i.e., managerial practices devoted to providing training and development for the workforce) mediate the relationship between family blockholders and environmental performance. Using a sample of 33,901 firm‐year observations from 2002 to 2016 distributed across 56 countries and employing the structural equation model technique, we find that investment in training and development practices explains almost half of the negative relationship between family blockholders and environmental performance. Our study contributes to the agency theory debate on principal–principal problems by explaining why family blockholders could damage other blockholders and minority shareholders.

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  • Lorenzo Dal Maso & Rodrigo Basco & Thomas Bassetti & Nicola Lattanzi, 2020. "Family ownership and environmental performance: The mediation effect of human resource practices," Business Strategy and the Environment, Wiley Blackwell, vol. 29(3), pages 1548-1562, March.
  • Handle: RePEc:bla:bstrat:v:29:y:2020:i:3:p:1548-1562
    DOI: 10.1002/bse.2452
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    File URL: https://doi.org/10.1002/bse.2452
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    2. Rafaela Gjergji & Luigi Vena & Salvatore Sciascia & Alessandro Cortesi, 2021. "The effects of environmental, social and governance disclosure on the cost of capital in small and medium enterprises: The role of family business status," Business Strategy and the Environment, Wiley Blackwell, vol. 30(1), pages 683-693, January.
    3. Andrea Venturelli & Salvatore Principale & Lorenzo Ligorio & Simona Cosma, 2021. "Walking the talk in family firms. An empirical investigation of CSR communication and practices," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(1), pages 497-510, January.
    4. Clara Gallego-Sosa & Yakira Fernández-Torres & Milagros Gutiérrez-Fernández, 2020. "Does Gender Diversity Affect the Environmental Performance of Banks?," Sustainability, MDPI, Open Access Journal, vol. 12(23), pages 1-15, December.

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