Nonfinancial Goals, Governance, and Dividend Payout in Private Family Firms

摘要

This paper uses insights from behavioral economics to explain dividend policy in private family firms. Based on a sample of 501 Belgian firms, our results indicate that dividend payout is low when a family chief executive officer (CEO) leads the business and in the presence of a family-dominated board. The tendency of a family CEO or family-dominated board to retain earnings appears to be stronger in earlier generational stages compared with later generational stages. The findings are consistent with (1) socioemotional objectives being important drivers of funding decisions in private firms where families possess important decision and control power and (2) these objectives being more predominant in early generational stages.