Get to Know KCFE's Krishnan Nair

Krishnan Nair is a Postdoctoral Fellow with KCFE

June 2020

Krishnan Nair is a Postdoctoral Fellow with KCFE. Before joining Kellogg, he received his PhD from Erasmus University in the Netherlands and his MPhil from the University of Cambridge in the UK. Krishnan studies how the process of biological and cultural evolution has shaped the psychology of individuals, and in turn, how these insights can inform our understanding of corporate governance, leadership, and politics, especially in the family business domain.

Evolutionary Biology and Family Harmony

In one line of research, Krishnan and his collaborator, Professor Edward Zajac, are studying how principles from evolutionary biology could shed light on the conditions under which family relations among family members are likely to be harmonious versus conflictual. While management researchers have increasingly characterized business owning families as a largely harmonious group that is united by a desire to pursue the long-term financial and non-financial interests of the family, numerous practitioner accounts and other research has highlighted the prevalence of destructive conflicts between family members. These contrasting accounts of the business owning family are analogous to a debate that took place in evolutionary biology in the 1970s. While the classical assumption in the discipline was that the family is a harmonious unit "designed" to maximize the number of surviving offspring, this view was challenged by later researchers who highlighted the prevalence of conflicts. As a result of these debates, the current consensus in evolutionary biology is that even the closest family relationships are characterized by both altruism and diverging interests.

At the same time, this literature highlights that the extent of altruism varies widely between family relationships as a function of two fundamental features - kinship proximity and kinship uncertainty. Specifically, individuals tend to behave more prosocially towards relatives who are presumed to share greater genetic overlap by virtue of common descent, and towards their matrilineal kin (i.e., relatives on the female line) over their patrilineal kin (i.e., relatives on the male line). Krishnan's research develops specific propositions regarding family characteristics that are more conductive to harmony versus conflict across the three major stages of family business development - the founder firm (1st generation), the sibling partnership (2nd generation), and the cousin consortium (3rd generation and beyond).

Various practical insights can be gleaned from this research. First, it is possible for family business leaders to anticipate some conditions under which the risk of future family conflict is likely to especially high or low, and to plan accordingly. For example, this research suggests that cousin consortiums primarily consisting of matrilineally related family members are less prone to conflicts relative to cousin consortiums consisting primarily of patrilineally related family members. Thus, while male heirs tend to be more involved than female heirs in most family firms, greater involvement by female heirs and their children could benefit the firm by promoting family harmony.

Second, this research sheds light on fundamental biases that may affect family decision-makers. Knowledge of these biases could allow family decision-makers to consciously reduce the effect of these biases. For example, practitioners and scholars alike have highlighted that leadership succession in family firms are especially likely to fail when there are conflicts between founders and their offspring successors. Krishnan's research suggests that for male (but not female) founders, physical dissimilarity with the offspring successor could heighten the potential for conflict. This bias (in which physical similarity affects the attachment of fathers to their children) is an evolutionary holdover from a time when non-paternity events (i.e., when someone who is believed to be the biological father to an offspring is not the actual biological father) were far more common than they are in the present day. However, by recognizing the existence of such biases, it could be possible for male founders to consciously reduce their influence. Females are not affected by this bias because females were always certain regarding their biological relationship with their offspring.

Family Business Members are Less WEIRD

In a second line of research, Krishnan and his collaborator, Professor Maryam Kouchaki, are examining the possibility that US family business leaders are less prototypically Western relative to their non-family business counterparts. A growing stream of research across the social and behavioral sciences highlight that individuals from societies that are WEIRD (i.e., Western, Educated, Industrialized, Rich, and Democratic), are particularly unique with respect to their values, their psychological profiles, and their behavior compared to much of the rest of the world. Specifically, individuals from WEIRD societies tend to be high on independence, individualism, and impersonal prosociality, but less holistic in their thinking, less loyal to their ingroups, less deferential to authority, and less prone to conform to social norms. Recent research suggests that much of this uniqueness can be traced to the weak nature of family ties in WEIRD societies relative to non-WEIRD societies.

Kinship ties tend to be stronger among members of business owning families. From when they are young, these individuals are instilled with the understanding that their fate and fortune is tied to that of their family members (e.g., their parents, their siblings, and their cousins). Members of business owning families also tend to have less freedom to pursue a career of their choosing given that they are often expected to join the family business. When relatives in Western societies do not get along, they can usually choose to limit interactions and/or move far away from each other; members of business owning families, however, often do not possess this luxury. Given the more durable nature of family ties in business owning families, members of these families are expected to possess less prototypically WEIRD characteristics than their non-family business counterparts.

There are a number of practical implications that arise from this perspective. First, business consultants are drawn disproportionately from the professional-managerial class, a group whose members tend to display characteristics that are especially WEIRD, even by Western standards. Thus, the lack of cultural fit between family business owners and consultants could increase communication barriers, which reduces the likelihood that consultants will find constructive solutions that family members are willing to implement. Given the potential differences in cultural values, it is crucial for family owners to select family business consultants that either: a) have similar values as themselves (e.g., because they come from a family business background), or b) are willing to recognize the cultural divide and take efforts to bridge it.

Second, since ethnic minorities and socially conservative Whites have been found to display less prototypically WEIRD characteristics, members of these groups could be more attracted to family businesses as potential employees and customers. The cultural fit between ethnic minorities and members of business owning families may become increasingly relevant as ethnic diversity continues to grow in the US.

Third, cultural distance has been cited as one of the most significant barriers to international expansion for businesses. Since our perspective suggests that family leaders in US family businesses are more similar culturally to individuals from non-WEIRD societies than leaders in US non-family businesses are, this could serve as a significant source of competitive advantage for family businesses seeking to expand abroad.