Evolution Has Shaped How We Relate to Our Families. What Does This Mean for Family Businesses?
KelloggInsight Article
November 2021
"A common view among scholars is that family members in family businesses really care about each other, and they're looking out for their long-term collective interests - both financial and nonfinancial," says Krishnan Nair, a postdoctoral fellow with the John L. Ward Center for Family Enterprises at Kellogg. "This is said to have downstream consequences for, say, risk-taking and acquisition behavior, and helps explain the lower likelihood of engaging in aggressive tax avoidance or being a big polluter."
In Nair's mind, this explanation has always seemed partial, at best. After all, it's also widely acknowledged that family businesses have high failure rates, especially as they attempt to transition from one generation of owners to the next. One of the key reasons for these failures, Nair says, is the pervasiveness of conflicts between family members - the exact opposite of the positive familial feelings and united commitment to their enterprise that many believe help these businesses.
