Navigating Sustainability Practice in Publicly Listed Family Firms: The U‐Shaped Impact of Family Ownership and the Moderating Role of MBA Leadership

Abstract

This study examines how family ownership influences sustainability practices in publicly listed firms by focusing on tensions between two socioemotional wealth (SEW) priorities: control preservation and reputation enhancement. Although family ownership is associated with distinctive sustainability behaviors, findings remain mixed due to conflicting SEW motivations. Using data from publicly listed firms in Korea, we find that family firms generally engage less in sustainability practices than nonfamily firms. However, this negative effect weakens at moderate ownership levels and reverses at high levels, suggesting a shift from control‐driven conservatism to reputation‐driven engagement. Additionally, we show that MBA‐educated executives on the board moderate this curvilinear relationship by balancing SEW priorities—reducing underinvestment at low ownership and curbing overinvestment at high ownership levels. Our findings contribute to the literature by identifying the conditions under which family ownership promotes or impedes sustainability efforts and by underscoring the critical role of board members' cognitive attributes in navigating SEW tensions within publicly listed family firms.