There is no place like home

Abstract

Family firms play an important role in the global economy. Family firms are defined as firms owned and managed by a family constellation. While their governance structure is different from non-family firms, family firms face similar questions of internalisation as their non-family counterparts. This study aims to determine how non-financial aspects may motivate the choice of internalising in family firms. To investigate how the non-financial aspects are relevant to the family firm's decision-making, this study focuses on one aspect of operations, production. The research question stems from theories of socio-emotional wealth, which is conceptualised through the five dimensions of the FIBER framework. To explore the relevance of socio- emotional wealth on family firms' decision to produce locally, qualitative semi-structured interviews have been conducted with four Swedish-based family firms. The results indicate that four dimensions of FIBER are reflected in the selected interviewees’ decision to keep manufacturing locally. The dimensions which appear to be relevant are; family control and influence, identification with the firm, binding social ties and emotional attachment. The results do not indicate that the fifth dimension, renewal of family bonds to the firm through dynastic succession, has a relevant impact on the research question stated.

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