Why Do Some Family Businesses Out–Compete? Governance, Long–Term Orientations, and Sustainable Capability

This article seeks to link the domains of corporate governance, investment policies, competitive asymmetries, and sustainable capabilities. Conditions such as concentrated ownership, lengthy tenures, and profound business expertise give some family–controlled business (FCB) owners the discretion, incentive, knowledge, and ultimately, the resources to invest deeply in the future of the firm. These long–term investments accrue from particular governance conditions and engender competitive asymmetries—organizational qualities that are hard for other firms to copy, and thus, if tied to the value chain, create capabilities that are sustainable. Investments in staff and training, e.g., create tacit knowledge and…