The international expansion of family firms: the moderating role of successor and external manager

Internationalisation is a key to productivity, profitability, innovation and growth, especially for family firms (FFs). This paper provides new evidence of the relationship between FFs’ features and their international growth. Through socioemotional wealth, it investigates how family impacts a multinational firm’s degree of internationalisation. Accordingly, it examines whether family affects the strategic decision to expand abroad through foreign direct investments. The sample comprises 361 Italian multinational companies affiliated with 5,348 foreign firms in the period 1994–2013. Given the continuous nature of the dependent variable, the degree of internationalisation, we adopt a multiple linear regression model. Family involvement in ownership is negatively associated with internationalisation, while governance has no effect. In contrast, the presence of young successors favours internationalisation. Moreover, the negative effect of family ownership is enhanced for firms with no external managers, and yet the negative effect of family ownership on internationalisation is lower for firms without successors.