Does state-owned equity participation affect the risk-taking level of family firms?
This study takes the A-share listed family firms in Shanghai and Shenzhen from 2008 to 2021 as the research object,and deeply explores the influence of state-owned equity participation on the level of risk taking of family firms.It is found that state-owned equity participation can significantly improve the level of risk-taking of family firms.Mechanism analysis shows that state-owned equity participation reduces the loss of family Socio-emotional Wealth,and then enhance the level of risk-taking of family firms.The specific performance is as follows:On the one hand,state-owned equity participation can disperse family equity to a certain extent,help family firms share risks in venture capital,reduce the wealth locking effect of the controlling family,and thus reduce the loss of family Socio-emotional Wealth.At this time,the controlling family feels that its Socio-emotional Wealth can be guaranteed,and the state-owned equity has the demand for investment returns.May engage in more venture capital activities,thereby increasing the level of corporate risk taking;On the other hand,state-owned equity participation can change the decision-making style of family firms to a certain extent,weaken the influence of the family by appointing senior executives or board members,and reduce the influence of altruism on risk decision-making.In addition,state-owned equity comes from different industries or holds shares of multiple companies,and its information sources are wide,providing information resources for firms.It can reduce the risk of decision making,thus reducing the loss of family Socio-emotional Wealth.When the controlling family perceives that its own level of Socio-emotional Wealth can be maintained,and the state-owned equity can provide resources to it,its motivation to engage in venture capital may be enhanced,thus increasing the level of risk-taking of family firms.Further research finds that fierce industry competition often means that the investment risks of family firms increase,which is likely to cause serious damage to the Socio-emotional Wealth of family firms,resulting in a decrease in the willingness of family firms to invest in risk.After state-owned equity participation,family firms not only share the investment risks,but also reduce the loss of family Socio-emotional Wealth.This may increase the willingness of family firms to engage in venture capital;The lower the level of regional financial development and the less sound the legal system,the lower the willingness of family firms to engage in venture capital.After state-owned equity participation,family firms can share investment risks and maintain a higher level of Socio-emotional Wealth,so the promotion of enterprise venture capital will be more obvious.Due to the low economic added value and weak growth,non-high-tech firms can get limited government incentives.If venture capital fails,the family Socio-emotional Wealth will be seriously lost.However,state-owned equity participation can bring various resources to the family enterprise,and it is more likely to obtain various subsidies,which provides a strong backing for family enterprise investment.It will help the family to maintain a high level of Socio-emotional Wealth,so as to strengthen the willingness of family firms to engage in risk investment.Therefore,we believe that when family firms belong to the above three situations,state-owned equity participation has a more significant promoting effect on the level of risk taking of family firms.The analysis of economic consequences shows that state-owned equity participation can improve the level of risk-taking of family firms,and then improve the performance of firms.The research conclusions provide some policy implications for further promoting the mixed ownership reform and promoting the development of family firms.In view of this,it is suggested that the government encourage state-owned equity to participate in family firms,in order to achieve synergistic development and mutual benefit.The government should deepen the supply-side structural reform of the financial sector and comprehensively strengthen the ability of the financial sector to serve the real economy.Encourage banks or other financial institutions to increase credit to family firms with development potential,and reduce financing costs and financing difficulties of family firms.The government should also further optimize the resource allocation mechanism and increase support for non-high-tech family firms.In addition to"equity participation",state-owned equity should also"management participation",actively participate in the management decision-making of family firms,and weaken the influence of the family by appointing senior executives or board members,so as to reduce the influence of non-economic goals such as altruism on the risk decision-making of family firms.Furthermore,state-owned equity should also provide active help for family firms in obtaining resources,so as to reduce the loss of family social emotional wealth and enhance the enthusiasm of firms to engage in venture capital.Family firms should pay attention to the opportunities brought by the mixed ownership reform,and should actively introduce state-owned equity and optimize equity allocation under the premise of ensuring family holding.In particular,family firms should make good use of the"political attribute"of state-owned equity and actively strive for scarce resources at the government level.In addition,if the degree of industry competition is high,the level of regional financial development is low,and the family business is a non-high-tech enterprise,the family business should actively introduce state-owned equity to improve its ability to bear risks.
family firmsstate-owned equity participationrisk-takingsocio-emotional wealth
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