Title: Two models of family firms in dividends and investments policy

Authors: Stefano Bresciani; Francesca Culasso; Elisa Giacosa; Laura Broccardo

Addresses: Department of Management, University of Turin, Italy, Corso Unione Sovietica, 218 bis, 10134 Torino, Italy ' Department of Management, University of Turin, Italy, Corso Unione Sovietica, 218 bis, 10134 Torino, Italy ' Department of Management, University of Turin, Italy, Corso Unione Sovietica, 218 bis, 10134 Torino, Italy ' Department of Management, University of Turin, Italy, Corso Unione Sovietica, 218 bis, 10134 Torino, Italy

Abstract: The purpose of our research is to verify the role of the family variable in the dividends policy and investments one, distinguishing family firms (FFs) and non-family firms (NFFs) and between large FFs (FFs listed in FTSE MIB index) and medium-sized FFs (FFs listed in STAR index), in terms of dividends and investments policies adopted. Medium-sized FFs have a weaker dividends distribution policy than large FFs, due to a high interest in saving the liquidity in order to finance the attractive investment opportunities. Large FFs are interested in a stronger dividends policy, in order to attract new shareholders and reward the old ones, more than with large NFFs. FFs have a stronger investments policy compared with NFFs and this difference is more evident in medium-sized companies. The medium-sized FF can take advantage of the power of the family to maintain a continuous growth and development of the business, even when liquidity is restricted.

Keywords: family firms; family businesses; dividends policy; investment policy; liquidity; new shareholders; shareholder rewards; large companies; medium-sized companies.

DOI: 10.1504/GBER.2016.076233

Global Business and Economics Review, 2016 Vol.18 No.3/4, pp.320 - 343

Received: 06 Feb 2014
Accepted: 09 Jun 2014

Published online: 28 Apr 2016 *

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