Family firms’ resilience during the COVID-19 pandemic: Evidence from French firms

Abstract

The purpose of this paper was to comprehend what are the characteristics that allow companies to be more resilient to cope with the crisis caused by the COVID-19 pandemic. More specifically, we explore the relationship between families’ involvement in corporate ownership and leadership and financial performance. Using a sample of 226 French-listed firms during the period from January 24 to April 27, 2020, we found that firms controlled by family shareholders showed higher stock market performance than their non-family in the pandemic period. This finding is stronger in the case of the first family firms’ generation where the founder still holds the position of executive chef, president or general manager. Contrary to our expectations, family firms perform better when led by a professional chief executive officer (CEO). Overall, our results add to previous research by illustrating how family ties influence a firm’s response to external shocks.