An investigation on the relationship between family-controlled business attributes and firmN international diversification
Family-controlled business (family business) is a prevalent business system in many countries of the world. In Taiwan, most of SMEs are categorized as the kind of family business. Even large public-listed companies, they are usually directly or indirectly controlled by a certain family. The critical decisions of family business are usually made by family members who dominant corporate strategies by incorporating their family interests in priority into the decisions.
Internationalization plays a strategic role in corporate long-term development and growth. This research intends to investigate the relationships between family business attributes and firm
international diversification. The research questions are described as follows: (1) based on agency theory, this research intends to investigate whether family ownership will trigger companies to engage in internationalizing activities. Do companies with higher family ownership be more likely to internationalize? (2) How does board composition of family business influence the international diversification? Does family business appoint outside directors on the board increase the propensity of family business to
internationalize? (3) Does speed of international expansion differ between family and nonfamily business? Does family business engage in international expansionary activities faster than their nonfamily counterparts? (4) Does power transition from the first to the second or third generation leaders have significant impacts on internationalizing activities? This research also intends to
understand the impacts of power transitions of family business on firm international diversification. In summary, this research extends prior literature to investigate the family business attributes and international diversification.
Keywords: family business international diversification agency theory
