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Familial altruism and reputation risk: evidence from China

Familial altruism and reputation risk: evidence from China The authors study the effects of altruism and intention for succession on family firm's reputation risk-taking behaviors in Chinese publicly listed companies.Design/methodology/approachThe authors use earnings management as a proxy for reputation risk in family firms, and hand-collected relationship between family members to measure the closeness of incumbent family members and their potential successors as a proxy for the altruistic degree.FindingsResults show that, in developing countries like China, familial altruism in family firms with succession plans, which does not reduce the practice of earnings management, should be considered by practitioners while detecting it.Originality/valueThe hand collected data are very unique; the authors have focused on the relationship between incumbents and successors and the authors define their closeness by using genes shared between them. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png China Finance Review International Emerald Publishing

Familial altruism and reputation risk: evidence from China

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
2044-1398
DOI
10.1108/cfri-01-2021-0016
Publisher site
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Abstract

The authors study the effects of altruism and intention for succession on family firm's reputation risk-taking behaviors in Chinese publicly listed companies.Design/methodology/approachThe authors use earnings management as a proxy for reputation risk in family firms, and hand-collected relationship between family members to measure the closeness of incumbent family members and their potential successors as a proxy for the altruistic degree.FindingsResults show that, in developing countries like China, familial altruism in family firms with succession plans, which does not reduce the practice of earnings management, should be considered by practitioners while detecting it.Originality/valueThe hand collected data are very unique; the authors have focused on the relationship between incumbents and successors and the authors define their closeness by using genes shared between them.

Journal

China Finance Review International – Emerald Publishing

Published: Oct 20, 2021

Keywords: Altruism; Family firm; Succession; Reputation risk; G30; G34; M41

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