Article2018

Entrepreneurial orientation and sustainability initiatives in family firms

54 citations0/0 files storedJournal of Global Responsibility

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Family Business Performance and Succession Entrepreneurship Studies and Influences Environmental Sustainability in Business

Abstract

Purpose This paper aims to examine the relationship between family firm generation, performance and entrepreneurial orientation (EO) in investments in sustainability initiatives. The objective of this research is to establish EO as an important antecedent of investments in sustainability initiatives, assess EO’s interaction with firm performance and establish that later-generation family firms are more environmentally and socially responsible. Design/methodology/approach Data were collected in-person from 151 top managers in automobile and motorcycle dealerships in the southwestern USA. Regression analysis was utilized to analyze the hypothesized relationships. Findings EO is significantly and positively related to investments in sustainability initiatives. That relationship is dependent on the performance of the firm. At low levels of EO, high-performing firms invest significantly more in sustainability initiatives. However, at high levels of EO, low-performing firms invest slightly more in sustainability initiatives. The generation of the family business is moderately related to sustainability investments, with later-generation family firms investing more. Originality/value The findings herein bridge the gap between the entrepreneurship and sustainability literature by establishing EO as an important antecedent of corporate responsibility. Further, the results indicate that firm mechanisms such as EO are more important than the performance of the firm or slack resources available.

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References

1991Firm Resources and Sustained Competitive Advantage 2004Firm resources and sustained competitive advantage 1995Toward a New Conception of the Environment-Competitiveness Relationship 1979A Three-Dimensional Conceptual Model of Corporate Performance 1996Clarifying the Entrepreneurial Orientation Construct and Linking It To Performance 2001Corporate Social Responsibility: A Theory of the Firm Perspective 1997THE CORPORATE SOCIAL PERFORMANCE-FINANCIAL PERFORMANCE LINK 1989Strategic management of small firms in hostile and benign environments

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