IDEAS home Printed from https://ideas.repec.org/p/arx/papers/2607.10876.html

Not All Family Firms Are Alike: How Founder-Led and Governance-Entrenched Family Control Shape the Trading Environment Around the Firm

Author

Listed:
  • Douglas Cumming
  • Esteban Hernandez
  • Shan Ji

Abstract

Family-firm scholarship offers competing predictions about whether family control protects or threatens market integrity. We argue that the answer depends on how family involvement is exercised. Drawing on socioemotional wealth and agency-entrenchment perspectives, we examine 8,634 U.S. firm-years (2007-2018) and link family-firm constructs to exchange-generated surveillance flags from NASDAQ SMARTS. Founder-CEO control is associated with approximately 9.5% fewer flags, family governance involvement with 21.3% more, and deep multi-generational family control with 47.1% more. The findings reveal heterogeneous identity and entrenchment mechanisms within family firms and connect family-firm governance to a market-integrity outcome previously absent from the literature.

Suggested Citation

  • Douglas Cumming & Esteban Hernandez & Shan Ji, 2026. "Not All Family Firms Are Alike: How Founder-Led and Governance-Entrenched Family Control Shape the Trading Environment Around the Firm," Papers 2607.10876, arXiv.org.
    • Handle: RePEc:arx:papers:2607.10876
    as

    Download full text from publisher

    File URL: https://arxiv.org/pdf/2607.10876
    File Function: Latest version
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:2607.10876. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: arXiv administrators (email available below). General contact details of provider: https://arxiv.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.