Self-Serving or Self-Actualizing? Models of Man and Agency Costs in Different Types of Family Firms: A Commentary on "Comparing the Agency Costs of Family and Non-Family Firms: Conceptual Issues and Exploratory Evidence."
Posted: 4 Nov 2009
Date Written: 2004
Provides a reaction tothearticle"Comparing the agency costs of family and non-family firms:Conceptual issues and exploratory evidence," by Chrisman, Chua, and Litz inthe same issue of Entrepreneurship Theory and Practice. This commentaryexamines theeffects of agency relationships on family firms presented byChrisman et al, andsuggests the alternative influence of stewardshiptheory, which complements the agency framework in explaining entrepreneurial,organizationally-centered behaviors. The main thrust is to suggest that differences in organizational performanceare not driven by family involvement or its lack, but more by the existence ofagency or stewardship relationships within firms, regardless of the degree ofactual family involvement. Conclusions indicate that Chrisman et al.'s findingsmay be flawed because their study did not provide any significant performancedifferences between family and non-family firms. The differences may also varyby the types of businesses in which family firms are engaged. It is suggestedthat the issues of agency and stewardship relationships should be studied morecarefully and should avoid oversimple dichotomies such as family and non-familyfirms.(JSD)
Keywords: Stewardship, Motivation, Firm performance, Firm ownership, Altruism, Research consortia, Firm management, Family firms, Agency theory
Suggested Citation: Suggested Citation