| This study applies social capital theory to the ownership group in private firms. Extant research on ownership focuses primarily on the type or structure of ownership, whether as independent or control variable, to predict various firm effects. However, especially in the private firm, owners are individual actors whose attitudes and behaviors play an integral role in the firm’s performance. Based on social capital theory, this study provides empirical support for the hypothesis that shared vision of the ownership group and the quality of the relationships between owners are positively associated with financial performance of the business. Furthermore, it hypothesizes a mediating effect of shared vision and the quality of the relationships on the association between family orientation and financial performance. The results of data analysis obtained from 811 Dutch multiply-owned, private businesses indicate that shared vision has a positive influence on financial performance of the business, but does not mediate the relationship between family orientation and financial performance. However, the relation between shared vision and financial performance is mediated by the quality of the relationships between owners. Finally, results show that the quality of relationships between owners mediates the relationship between family orientation and financial performance. |
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| The Erasmus - EIM - Panteia Entrepreneurship Lectures Series is co-organized by Erasmus Research Institute of Management (ERIM.nl) and EIM Business & Policy Research (EIM/Panteia), an independent and international research and consultancy organisation, specialised in SMEs and Entrepreneurship. EIM is part of the Panteia group. |
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| Contact information: |
| Ingrid Verheul |
Jörn Block |
| Email |
Email |
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