Board of Directors Characteristics and Performance in Family Firms

This paper examines the relationship between board of director characteristics and performance in family businesses, providing evidence on whether family firms differ from non-family ones and focusing also on the possibility of asymmetrical effects between periods of stability and economic adversity. To fulfill this objective, a sample of Portuguese listed firms was analysed for the 2002-2013 period, using a panel data approach. The results show that family firms are likely to have lower proportion of independent members and higher gender diversity on their boards than non-family firms. Family firms’ performance is positively related with ownership concentration and gender diversity. There are performance premiums for family businesses with more gender diversity relative to their counterparts. These effects also depend on whether the economy is in recession or not. The evidence suggests that the presence of women on board and the firms’ leverage and size impact more significantly on family firms’ performance in periods of economic adversity.