Ownership structure and the use of non-family executives in family-dominated Chinese listed firms: An institutional logics perspective

摘要

To investigate the use of non-family versus family executives in family-dominated, publicly listed firms, we consider ownership concentration both at the firm level and within the dominant family. Whereas the appointment of family executives is supported by an institutional logic of family control, the use of non-family, professional executives is guided by a shareholder logic. We suggest that higher levels of ownership held by the dominant family relative to other shareholders propel family owners to adopt the family logic, and higher levels of ownership held by the largest family owner relative to other family members weaken the family logic in favor of the shareholder logic. We test our hypotheses on a sample of 2174 firm-year observations covering 635 family-dominated Chinese entrepreneurial firms listed on the Shenzhen Stock Exchange. Statistical results indicate that ownership by family increases, and ownership concentration in family decreases, the use of non-family CEO and non-family top management team.