When Resilience Runs in the Family

RESEARCH BY AMORE, QUARATO, AND PELUCCO SHOWS THAT COMPANIES WITH FAMILY MEMBERS AS CONTROLLING SHAREHOLDERS BETTER FACED THE FIRST PANDEMIC WAVE

In some ways, the ongoing emergency did not surprise business scholars, but, on the contrary, confirmed even more clearly the scientific evidence observed previously. One of these is the study of family companies, whose resilience in times of crisis had already been observed in several other circumstances. "In 2017, for example, my colleague Alessandro Minichilli and I wanted to test the theories on the relationship between uncertainty and business investment," says Mario Daniele Amore, professor at the Department of Management and Technology. "We were thus able to confirm that family-run companies have the antibodies needed to neutralize the harmful effect of political instability on the company's development strategies and produce profitability and growth even in adverse contexts".
 
Certain structural characteristics favor this type of business, such as long-term vision, typical of entrepreneurs who interpret the company as an asset to be preserved and bequeathed to subsequent generations, but also greater cohesion between shareholders and relationships of greater quality with external stakeholders, from local institutions to the supply chain. "The winning aspects related to the governance of Italian family firms, in particular listed family companies, are the subject of another research study for the COVID Crisis Lab, currently underway with Fabio Quarato and Valerio Pelucco, and set in the context of the current pandemic", continues Amore. "On this occasion we found that companies with family members as controlling shareholders performed better than other types of companies during the first wave of the pandemic."
 
These studies therefore broaden the knowledge on the characteristics of business resilience in the course of adverse events, also including new observation topics, such as the implementation of smartworking. “On this, together with Professor Quarato, we are concluding a study on the timing of adoption of smartworking practices in listed companies, and also in this case early results point to a greater readiness in the response coming from family businesses. The close ties between shareholders and management act as a facilitators when major organizational changes need to be introduced; these companies therefore moved earlier and faster than the others, presenting themselves as better organized and more operational on the market.

by Emanuele Elli
Translated by Alex Foti