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Financial Conservatism in Family Businesses: A Double-edged Sword
[Conservatisme Financier des Entreprises Familiales : un Biais à Double Tranchant]

Author

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  • Hamza Nidaazzi

    (UCA - Université Cadi Ayyad [Marrakech])

  • Hind Hourmat Allah

    (UCA - Université Cadi Ayyad [Marrakech])

Abstract

Behavioral finance, a thriving domain within management science, is garnering increasing interest. However, the concept of family firms' financial conservatism in Morocco has been relatively unexplored. To facilitate the initiation of a discourse on this issue, we found it opportune to delve into and analyze this aspect. In order to open a debate on this problem, the aim of this paper is to explore and analyze the junction that can exist between financial strategy and conservatism in the family business. Using a qualitative study, this paper explores the points of view, perceptions, and behaviors of conservative managers and owners of twelve Moroccan Family firms. In contrast to the existing literature, results show that conservative family firms are profitable, have high levels of cash flow, and face lower costs in times of crisis. Our analyses also shows that financial conservatism is only threatening if it is forced due to financial constraints.

Suggested Citation

  • Hamza Nidaazzi & Hind Hourmat Allah, 2024. "Financial Conservatism in Family Businesses: A Double-edged Sword [Conservatisme Financier des Entreprises Familiales : un Biais à Double Tranchant]," Post-Print hal-04518830, HAL.
    • Handle: RePEc:hal:journl:hal-04518830
    DOI: 10.5281/zenodo.10853385
    Note: View the original document on HAL open archive server: https://hal.science/hal-04518830v1
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    References listed on IDEAS

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    Keywords

    Family Business; Conservatism; Financial Policy; Behavioral Finance; Sustainability; Entreprise Familiale; Conservatisme; Politique Financière; Finance Comportementale; Pérennité.;
    All these keywords.

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