Compliance management in family firms: A systematic literature analysis

Abstract

Family firms play an important economic role in Europe and in the world. The discussion of compliance-relevant issues has long been attributed to capital market-oriented large companies. So far, there have been few findings on the perception, dissemination and implementation of this concept in family businesses. The purpose of this paper is to provide a systematic and iterative literature review of available research on compliance management and corruption in family firms. Thereby a total of 47 articles on the topic were identified. The review acknowledged that Compliance/Corruption is a research topic but not often in the context of family firms. The literature of family enterprises dealt with the influence of family ownership on firms’ non-compliance with corporate governance codes out of the socio-emotional wealth perspective or examined the relationship between family control and young entrepreneurial firms’ bribing behaviour around the globe. Another perspective offers the literature about the agency and stewardship theories and their influence on family firms. Agency and stewardship governance affects individual-level behaviour and firm-level performance in a distinct and combined way. In the business ethics literature a few interesting papers were found, that consider unethical work behaviour or corrupt acts in the context of organizations and family firms. In addition, the analysis of the publications demonstrates the importance of compliance management in all types of companies/SMEs and shows that companies which have integrated compliance management gain a competitive advantage over their competitors. We come to the conclusion that additional empirical research on compliance and corruption in family firms is needed.