A Research on the Effects of Nonfamily Manager Involvement on ESG Performance
DOI:
https://doi.org/10.54097/pghvne54Keywords:
Family firms, Nonfamily managers, ESG performance, Agency theory, FamilismAbstract
Amid growing environmental concerns and the pivotal role of family firms in the global economy, scholars have increasingly focused on the factors that drive their sustainable performance. Family firms, which balance both economic and non-economic goals, often prioritize long-term sustainability over short-term profits. However, the interplay between family governance and professional management introduces challenges in achieving sustainable outcomes. Drawing on socio-emotional wealth theory, this paper analyzes panel data from Chinese listed family firms between 2013 and 2022 to reveal an inverted U-shaped relationship between nonfamily manager involvement and corporate Environmental, Social, and Governance (ESG) performance. Furthermore, the study examines how Chinese traditional cultural values, particularly "familism", moderate this nonlinear relationship. Multiple robustness checks validate the findings. This research advances academic literature by deepening the understanding of non-financial consequences related to nonfamily manager involvement in family firms, while providing practical insights for businesses pursuing sustainability.
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