Understanding Employee Ownership in the Context of French Family Firms

Abstract

Family firms, in which a family controls a majority stake in the organisation, are often considered characteristically different from non-family firms. However, our understanding of employee ownership in the specific context of family firms suffers from the concerns raised by owners of several family firms about such ownership. The decision to open the capital to its employees goes beyond the question of the ownership of family business. Nevertheless, it impacts the governance of the company and raises several concerns including the transmission of information, transparency, increased formalism, and taxation. This study aims to analyze how family firms benefit from an employee ownership plan and how governance practices impact the mechanism of employee ownership plans. This study examines the financial communication of French family firms in terms of mployee ownership activities.