more-arw search

Family-owned Companies Emphasize Social Responsibility

Corporate responsibility is stronger among family-owned businesses.

A study from Brigham Young University shows that CFOs and other executives are more likely to be socially responsible if their corporations are family owned. The research, published in the Journal of Business Ethics, ranked companies' social performance by community, product, diversity,

A study from Brigham Young University shows that CFOs and other executives are more likely to be socially responsible if their corporations are family owned. The research, published in the Journal of Business Ethics, ranked companies' social performance by community, product, diversity, human rights and employee relations.

"Family firms are often more aware of issues surrounding their stakeholders because the founder has established a personal relationship with customers, or with a distributor, or a supplier, in addition to shareholders," said lead author John Bingham, associate professor of organizational leadership and strategy.

He added that non-family companies would do well to mimic these practices, noting that social responsibility doesn't have to come at the cost of profits or shareholder interests.

Gibb Dyer, professor of organizational leadership and strategy and coauthor of the report, said part of the reason for the findings may be that the family's name (and reputation) is directly related to and impacted by the actions of the company.

It seems corporations worldwide are taking the issue seriously. LawAndTax-News notes that a study by KPMG found that the U.K. and Japan rank as the highest and second highest (respectively) when it comes to monitoring and reporting on their corporate responsibility behavior. 

Topics: