Small Business Economics

, Volume 29, Issue 3, pp 275–293 | Cite as

Owner Commitment and Relational Governance in the Privately-Held Firm: An Empirical Study

  • Lorraine M. Uhlaner
  • Roberto H. Floren
  • Jurgen R. Geerlings
Research Article

Abstract

This paper examines owner commitment and relational governance in the privately-held firm. The proposed model goes beyond agency theory to include research on organization commitment and organization citizenship behaviors, as well as stewardship theory, organizational social capital theory, social identity theory and social exchange theory. Results support predictions of stewardship theory and organizational social capital theory that owner commitment and firm performance are positively related.

Keywords

financial performance owner commitment relational governance social exchange theory social identity theory stewardship theory 

JEL Classifications

L26 M13 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. Allen N. J., Meyer J. P. (1996). Affective, Continuance, and Normative Commitment to the Organization: An Examination of Construct Validity. Journal of Vocational Behavior 49:252–276CrossRefGoogle Scholar
  2. Anderson R. C., Reeb D. M. (2003). Founding Family Ownership and Firm Performance: Evidence from the S&P500. Journal of Finance 58(3):1301–1328CrossRefGoogle Scholar
  3. Astrachan J. H., Klein S. B., Smyrnios K. X. (2002). The F-PEC Scale of Family Influence: A Proposal for Solving the Family Business Definition Problem. Family Business Review 15(1):45–58CrossRefGoogle Scholar
  4. Baron R. M., Kenny D. A. (1986). The Moderator-Mediator Variable Distinction in Social Psychological Research: Conceptual, Strategic, and Statistical Considerations. Journal of Personality and Social Psychology 51(6):1173–1182CrossRefGoogle Scholar
  5. Bishop J. W., Scott K. D., Goldsby M. G., Cropanzano R. (2005). A Construct Validity Study of Commitment and Perceived Support Variables. Group and Organization Management 30(2):153–180CrossRefGoogle Scholar
  6. Brief A. P., Motowidlo S. J. (1986). Prosocial Organizational Behaviors. Academy of Management Review 11(4):710–725CrossRefGoogle Scholar
  7. Cowling M. (2003). Productivity and Corporate Governance in Smaller Firms. Small Business Economics 20(4):335–344CrossRefGoogle Scholar
  8. Davis J. H., Schoorman F. D., Donaldson L.. (1997). Toward a Stewardship Theory of Management. Academy of Management Review 22(1):20–47CrossRefGoogle Scholar
  9. DeCotiis T. A., Summers T. P.. (1987). A Path Analysis of a Model of the Antecedents and Consequences of Organizational Commitment. Human Relations 40(7):445–470CrossRefGoogle Scholar
  10. Dekkers, E. J. M., 2003, Innovation in Dutch family-Orientated Firms: The Direct and Indirect Effects of Family Orientation on Innovation. Master thesis, Management van Innovatie, Rotterdam School of Management, Erasmus University RotterdamGoogle Scholar
  11. De Kok J. M. P., Uhlaner L. M., Thurik A. R. (2006). Professional HRM Practices in Family Owned-Managed Enterprises. Journal of Small Business Management 44(3):441–460CrossRefGoogle Scholar
  12. Dittmar H. (1992). The Social Psychology of Material Possession: To Have is to Be. St Martins Press, New YorkGoogle Scholar
  13. Eisenberger R., Fasolo P., Davis-LaMastro V. (1990). Perceived Organizational Support and Employee Diligence, Commitment, and Innovation. Journal of Applied Psychology 75(1):51–59CrossRefGoogle Scholar
  14. Ellemers N. (2001). Social Identity, Commitment, and Work Behavior. In: Hogg M. A., Terry D. J. (eds) Social Identity Processes in Organizational Contexts. Psychology Press, Taylor and Francis Group, Philadelphia, PA, pp. 101–114Google Scholar
  15. Etzioni A. (1995). The Responsive Community: A Communitarian Perspective 1995 Presidential Address. American Sociological Review 61(1):1–11CrossRefGoogle Scholar
  16. Faccio M., Lang L. P. H., Young L.. (2001). Dividends and Expropriation. American Economic Review 91:54–78CrossRefGoogle Scholar
  17. Gallo M. Á. (2004). The Family Business and its Social Responsibilities. Family Business Review 17(2):135–149CrossRefGoogle Scholar
  18. Gallo, M. Á. 1991, Las Trampas Profundas de las Empresas Gamiliares’, Staff Catalunya, 10, cited in Vilaseca A. (2002). The Shareholder Role in the Family Business: Conflict of Interests and Objectives Between Nonemployed Shareholders and Top Management Team’, Family Business Review 15(4), 299–320Google Scholar
  19. Gallo, M. Á. and Cappuyns, K. 2000, Ethics on Family Business, Monographic-2, IESEGoogle Scholar
  20. Hall, A. 2005, ‚Beyond the Legal: Psychological Ownership and Responsibility in the Family Business’, Paper presented at the FBN-IFERA World Academic Research Forum, EHSAL Brussels Google Scholar
  21. Harris L. C. (2001). Market Orientation and Performance: Objective and Subjective Empirical Evidence from UK Companies. Journal of Management Studies 38(1):17–43CrossRefGoogle Scholar
  22. Huijbregts, D. 2003, Generatiekloven en – conflicten binnen het familiebedrijf [Generation gaps and conflicts within the family business], Doctoral thesis, Vrije Universiteit, AmsterdamGoogle Scholar
  23. Huse M. (2005). Accountability and Creating Accountability: A Framework for Exploring Behavioural Perspectives of Corporate Governance. British Journal of Management 16:S65–S79CrossRefGoogle Scholar
  24. Huse M. (1994). Board-Management Relations in Small Firms: The Paradox of Simultaneous Independence and Interdependence. Small Business Economics 6:55–72CrossRefGoogle Scholar
  25. Huse M. (1993). Relational Norms As a Supplement to Neo-Classical Understanding of Directorates: An Empirical Study of Boards of Directors. Journal of Socio-Economics 22(3):219–240CrossRefGoogle Scholar
  26. James L. R., Brett J. M. (1984). Mediators, Moderators, and Tests for Mediation. Journal of Applied Psychology 69(2):307–321CrossRefGoogle Scholar
  27. Jaramillo F., Mulki J. P., Marshall G. W. (2005). A Meta-Analysis of the Relationship between Organizational Commitment and Salesperson Job Performance: 25 Years of Research. Journal of Business Research 58(6):705–714CrossRefGoogle Scholar
  28. Jaskiewicz, P. 2005, ‚Family Influence and Performance: An Empirical Study for Germany and France’, Paper presented at the FBN-IFERA World Academic Research Forum, EHSAL BrusselsGoogle Scholar
  29. Jensen M., Meckling W.. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics 3(4):305–360CrossRefGoogle Scholar
  30. Jonker, M. 2001, Bedrijfsopvolging binnen familiebedrijven [Business transfer in family businesses], Jonker Advies, AmsterdamGoogle Scholar
  31. Jost J. T., Elsbach K. D. (2001). How Status and Power Differences Erode Personal and Social Identities at Work: A System Justification Critique of Organizational Applications of Social Identity Theory. In: Hogg M. A., Terry D. J. (eds) Social Identity Processes in Organizational Contexts. Psychology Press, Taylor and Francis Group, Philadelphia, PA, pp. 181–196Google Scholar
  32. Kumar N., Stern L. W., Anderson J. W. (1993). Conducting interorganizatioanl research using key informants. Academy of Management Journal 36:1663–1651CrossRefGoogle Scholar
  33. Lambrecht, J. and Uhlaner, L. M. 2005, ‚Responsible Ownership of the Family Business; State of the Art’, Paper presented at the FBN-IFERA World Academic Research Forum, EHSAL BrusselsGoogle Scholar
  34. Lelieveld, K. 2003, In de Hoofdrol? [In the spotlight?], Doctoral thesis, Vrije Universiteit, AmsterdamGoogle Scholar
  35. Leana C. R., Van Buren H. J. III (1999). Organizational Social Capital and Employment Practices. Academy of Management Review 24(3):538–555CrossRefGoogle Scholar
  36. MacNeil I. R. (1980). The New Social Contract: An Inquiry into Modern Contractual Relations Yale University Press, New Haven and LondonGoogle Scholar
  37. Mathieu J. E., Zajac D. M. (1990). A Review and Meta-Analysis of the Antecedents, Correlates, and Consequences of Organizational Commitment. Psychological Bulletin 108(2):171–194CrossRefGoogle Scholar
  38. McGregor, D. 1960, The Human Side of the Enterprise, McGraw-Hill, New YorkGoogle Scholar
  39. Menéndez-Requejo, S. 2005, ‚Ownership Structure and Firm Performance: Evidence from Spanish Family Firms’, Paper presented at the FBN-IFERA World Academic Research Forum, EHSAL BrusselsGoogle Scholar
  40. Meyer J. P., Paunonen S. V., Gellatly I. R., Goffin R. D., Jackson D. S. (1989). Organizational Commitment and Job Performance: It’s the Nature of the Commitment That Counts. Journal of Applied Psychology 74(1):152–156CrossRefGoogle Scholar
  41. Morrison E. (1994). Role Definitions and Organizational Citizenship Behavior: The Importance of the Employee’s Perspective. Academy of Management Journal 37(6):1543–1567CrossRefGoogle Scholar
  42. Mowday R. T., Porter L. W., Steers R. M. (1982). Employee-Organizational Linkages: The Psychology of Commitment, Absenteeism, and Turnover Academic Press, New YorkGoogle Scholar
  43. Mustakallio, M. E. 2002, ‚Contractual and Relational Governance in Family Firms: Effects on Strategic Decision-Making Quality and Firm Performance’, Helsinki University of Technology: Institute of Strategy and International Business, Doctoral Dissertations 2002/2Google Scholar
  44. Mustakallio M., Autio E., Zahra S. A. (2002). Relational and Contractual Governance in Family Firms: Effects on Strategic Decision Making. Family Business Review 15(3):205–222CrossRefGoogle Scholar
  45. Nordqvist, M. 2005, Understanding the Role of Ownership in Strategizing: A Study of Family Firms, JIBS Dissertation Series No. 029Google Scholar
  46. O’Reilly Ch. III, Chatman J. (1986). Organizational Commitment and Psychological Attachment: The Effects of Compliance, Identification, and Internalization on Prosocial Behavior. Journal of Applied Psychology 71(3):492–499CrossRefGoogle Scholar
  47. Organ D. W., Ryan K. (1995). A Meta-Analytic Review of Attitudinal and Dispositional Predictors of Organizational Citizenship Behavior. Personnel Psychology 48(4):775–802CrossRefGoogle Scholar
  48. Pierce J. L., Kostova T., Dirks K. T. (2001). Toward a Theory of Psychological Ownership in Organizations. Academy of Management Review 26(2):298–310CrossRefGoogle Scholar
  49. Pierce, J. L., Van Dyne, L. and Cummings, L. L. 1992, ‚Psychological Ownership: A Construct Validation Study’, in Schnake M. (ed.), Proceedings of the Southern Management Association, Valdosta, GA: Valdosta State University, pp.␣203–211Google Scholar
  50. Podsakoff P. M., Organ D. W. (1986). Self-Reports in Organizational Research: Problems and Prospects. Journal of Management 12(4):531–544CrossRefGoogle Scholar
  51. Podsakoff P. M., MacKenzie S. B., Lee J. Y., Podsakoff N. P. (2003). Common Method Biases in Behavioral Research: A Critical Review of the Literature and Recommended Remedies. Journal of Applied Psychology 88(5):879–903CrossRefGoogle Scholar
  52. Pollak R. A. (1985). A Transaction Cost Approach to Families and Households. Journal of Economic Literature 23(2):581–608Google Scholar
  53. Poutziourios, P. 2005, ‚The Structure and Performance of the UK Family Business PLC Economy’, Paper presented at the FBN-IFERA World Academic Research Forum, EHSAL BrusselsGoogle Scholar
  54. Rashid M. Z. A., Sambasivan M., Johari J. (2003). The Influence of Corporate Culture and Organizational Commitment on Performance. Journal of Management Development 22(7/8):708–728CrossRefGoogle Scholar
  55. Rousseau D. M., Schalk R. (2000). Psychological Contracts in Employment: Cross-National Perspectives Sage Publications, Thousand Oaks, CAGoogle Scholar
  56. Rowe W. G., Morrow J. L. Jr. (1999). A Note on the Dimensionality of the Firm Financial Performance Construct Using Accounting, Market, and Subjective Measures. Canadian Journal of Administrative Sciences 16(1):58–70CrossRefGoogle Scholar
  57. Sacristán-Navarro, M. and Gómez-Ansón, S. 2005, ‚Family Ownership, Corporate Governance and Firm Value’, Paper presented at the FBN-IFERA World Academic Research Forum, EHSAL BrusselsGoogle Scholar
  58. Schulze W. G., Lubatkin M. H., Dino R. N., Buchholtz A. K.. (2001). Agency Relationships in Family Firms: Theory and Evidence. Organization Science 12(2):99–116CrossRefGoogle Scholar
  59. Schulze W. G., Lubatkin M. H., Dino R. N. (2003). Toward a Theory of Agency and Altruism in Family Firms. Journal of Business Venturing 18(4):473–490CrossRefGoogle Scholar
  60. Sharma P. (2004). An Overview of the Field of Family Business Studies: Current Status and Directions for the Future. Family Business Review 17(1):1–36CrossRefGoogle Scholar
  61. Sharma, P. and Irving, P. G. 2005, ‚Four Bases of Family Business Successor Commitment: Antecedents and Consequences’, Entrepreneurship: Theory and Practice 30, 13–33Google Scholar
  62. Shore L. M., Wayne S. J. (1993). Commitment and Employee Behavior: Comparison of Affective Commitment and Continuance Commitment with Perceived Organizational Support Journal of Applied Psychology 78(5):774–780CrossRefGoogle Scholar
  63. Smith C. A., Organ D. W., Near J. P. (1983). Organizational Citizenship Behavior: Its Nature and Antecedents. Journal of Applied Psychology 68(4):653–663CrossRefGoogle Scholar
  64. Sorenson R. L. (2000). The Contribution of Leadership Style and Practices to Family and Business Success. Family Business Review 13(3):183–200CrossRefGoogle Scholar
  65. Tajfel H., Turner J. C. (1985). The Social Identity Theory of Intergroup Behavior. In: Worchel S., Austin W. G. (eds) Psychology and Intergroup Relations, 2nd ed. Nelson-Hall, Chicago, pp 7–24Google Scholar
  66. Thomsen S., Pedersen T. (2000). Ownership Structure and Economic Performance in the Largest European Companies. Strategic Management Journal 21:689–705CrossRefGoogle Scholar
  67. Tippins M. J., Sohi R. S. (2003). IT Competency and Firm Performance: Is Organizational Learning a Missing Link?. Strategic Management Journal 24:745–761CrossRefGoogle Scholar
  68. Uhlaner L. M. (2005). The Use of the Guttman scale in Development of a Family Orientation Index for Small-to-Medium-sized firms. Family Business Review 43(1):41–56CrossRefGoogle Scholar
  69. Uhlaner, L.M., Flören, R. H. and Thomassen A. J. 2005, ‚Ownership Composition, Relational Governance and the Family Business’, Paper presented at the FBN-IFERA World Academic Research Forum, EHSAL BrusselsGoogle Scholar
  70. Uzzi B. (1996). The Sources and Consequences of Embeddedness of Economic Performance of Organizations: The Network Effect. American Sociological Review 61:674–698CrossRefGoogle Scholar
  71. Vandewalle D., Van Dyne L., Kostova T. (1995). Psychological Ownership: An Empirical Examination of Its Consequences. Group and Organization Management 20(2):210–226CrossRefGoogle Scholar
  72. Van Eerde, W. Van and Thierry H. 1996, ‚Vroom’s Expectancy Models and Work-Related Criteria: A Meta-Analysis’, Journal of Applied Psychology 81(5), 575–586Google Scholar
  73. Verheul I., Uhlaner L. M., Thurik A. R. (2005). Business Accomplishments, Gender and Entrepreneurial Self-Image. Journal of Business Venturing 20(4):483–518CrossRefGoogle Scholar
  74. Vilaseca A.. (2002). The Shareholder Role in the Family Business: Conflict of Interests and Objectives Between Nonemployed Shareholders and Top Management Team. Family Business Review 15(4):299–320CrossRefGoogle Scholar
  75. Voss G. B., Voss Z. G. (2000) Strategic Orientation and Firm Performance in an Artistic Environment. Journal of Marketing 64(1):67–83CrossRefGoogle Scholar
  76. Westhead P., Cowling M. (1997). Performance Contrasts between Family and Non-family Unquoted Companies in the UK. International Journal of Entrepreneurial Behaviour & Research 3(1):30–52CrossRefGoogle Scholar
  77. Zellweger, T., Fueglistaller, U. and Meister, R. 2005, ‚The␣Outperformance of Family Firms: The Role of Variance in Earnings per Share and Analyst Forecast Dispersion’, Paper presented at the FBN-IFERA World Academic Research Forum, EHSAL BrusselsGoogle Scholar

Copyright information

© Springer Science+Business Media, LLC 2007

Authors and Affiliations

  • Lorraine M. Uhlaner
    • 1
  • Roberto H. Floren
    • 2
  • Jurgen R. Geerlings
    • 3
  1. 1.Erasmus University RotterdamRotterdamThe Netherlands
  2. 2.Nyenrode Business UniversityBreukelenThe Netherlands
  3. 3.MESA Family Business ConsultantsMaarsbergenThe Netherlands

Personalised recommendations