Family Governance: Managing Dispersed Ownership Within the Owning Family Through Procedural Justice

This thesis examines how a family manages the shared ownership of a family business. This is an important, as well as a challenging issue within many owning families of family businesses. Research on this specific issue is still scarce. As ownership gets dispersed across generations, an organizing framework for family governance is often developed to facilitate decision-making processes concerning the non-legally binding issues within the owning family. Despite development of mutual agreements and processes, governing an owning family - a heterogenous group of individuals in several generations with different needs and expectations - is a considerable challenge for many families. Hence, this thesis aims at increasing understanding of family governance and how multigenerational owning families can manage challenging situations around the mutual ownership and family governance issues.
This dissertation is based upon three essays examining the concept of family governance. Essay 1, a literature review, examines how the concept of family governance has been researched and perceived within the field of family business research. Essay 2, a book chapter, provides an overview of different roles a family governance system can have within owning families and discusses how family governance functions in practice. Essay 3, an empirical essay, examines how multigenerational owner families react to experiences of injustice concerning the family constitution. The empirical study explores how family members react when the mutually designed and developed family governance agreements are perceived to be ignored by members of the owner family.
The essays process the research problems through a theoretical model as well as through an empirical study, drawing on the literature of procedural justice. The qualitative approach of in-depth case studies and close contact with family realities deepens the knowledge of the drivers of the owning family. By also acknowledging the role of injustice in the discussion, reactions of family members can be understood and addressed in a constructive way.
There have been several calls for more qualitative studies focusing on the family behind the firm as a unit of analysis and looking more closely at the dynamics of the family. Family and business governance and their intersection is highly relevant and essential for business and family sustainability. Therefore, this thesis adds understanding for both research and practice concerning perceptions of justice in processes for handling the shared ownership within the owning families.