Study explores why 'family' CEOs think differently
Thursday, December 10, 2015 - 09:24
in Mathematics & Economics
Founder-CEOs and CEOs related to the founder see the world differently than CEOs of non-family firms, and they pursue different strategies, according to new research from the Robert H. Smith School of Business at the University of Maryland. In general, the more family-oriented the firm, the more of a "stakeholder" focus it has. Faced with a choice between continuing to pay dividends and laying off workers, for example, founders and CEOs related to the firm's founder lean toward protecting workers; professional CEOs instead prioritize payouts to shareholders. Unlike non-family CEOs, founders and CEOs related to the founder also prioritize banks that lend to the firm over shareholders.