Conflicts in Boards of Family Firms: A Theoretical Framework for Strategic Decision-Making

Abstract

Conflicts are social phenomena liable to occur in any organizational type; however, they're more intense (and less understood) in the family business dynamics, due to the unique psychodynamic effects of the interaction between family, management, and property. At the same time, conflicts can also be particularly salient in the ambiguous and complex context of boards (the black box of corporate governance), by the intimate connection with strategic decisions. Intersecting both areas, this study proposes a theoretical framework connecting antecedents and consequences of intragroup conflicts in the strategic decision-making process (especially in the decision quality), in the particular and favorable context of family firms board of directors. Based on deductive logic, relationships are built in view of the director' strategic counseling function, potentially raising the quality of strategic decisions by reducing the relational dimension and stimulating the organizational task-oriented discordance. Variables and constructs, suited to the specificities of the context under investigation, are proposed in direct and moderation relations under a contingency perspective.

Keywords

• strategic decision-making
• family business
• boards of directors