The Family Business – Meaning and Contribution to Global Economies

What Does Being a Family Business Mean?The study of family businesses is still in its early stages as an academic discipline, and there is a significant challenge within the academic and business communities due to the absence of a standardised and agreed-upon definition of what precisely constitutes a family business.Professor John Davis, a leading expert in this field, has undertaken a comprehensive review of multiple definitions found in the existing literature and has classified them into two primary categories: structural definitions and process definitions (Davis, 2001).The structural definition of a family business focuses on the ownership or management arrangements within the enterprise.For instance, one aspect of the structural definition could be that a family owns 51% or more of the business.This approach highlights the tangible and quantitative aspects of family involvement in the business.On the other hand, the process definition of a family business revolves around the level of engagement and influence that the family has in the operations and decision-making of the business.The process definition looks at the family's impact on the business's policies and its desire to maintain control over the company's direction.To illustrate the different perspectives, Table 1 has been created, presenting definitions from prominent researchers in the field of family businesses.The definitions in the table have been categorised according to Davis's (2001) classification of structural versus process perspectives, enabling a clearer understanding of the various viewpoints on what constitutes a family business.This categorisation helps shed light on the diverse ways scholars and practitioners approach the definition of family businesses and their underlying characteristics.Attaining the 2030 Sustainable Development Goal of Good Health and Well-Being, 13-25