Explaining Performance Differences Between Family Firms With Family and Nonfamily CEOs: It's the Nature of the Tie to the Family That Counts!

Drawing on regulatory focus theory, we advance a microtheory for Naldi, Cennamo, Corbetta, and Gomez-Mejia's findings suggesting that family ties as well as the career aspirations that derive from them trigger relatively higher prevention and relatively lower promotion goal orientations of family when compared with nonfamily chief executive officers (CEOs). Our conceptualization offers an alternative theory for why family firms with family CEOs outperform those with nonfamily CEOs in contexts such as industrial districts where conservation strategies are more valuable, but underperform in contexts such as publicly listed firms where market-driven strategies are more valuable. Our commentary highlights the need for future research to examine variance in the self-regulatory mindsets of family and nonfamily CEOs, and to link these differences to firm strategies and performance.