FacebookFacebook icon TwitterTwitter icon LinkedInLinkedIn icon Email
Family futurity


Futurity, continuity and perseverance: the key assets in surviving adversity 

Published 4 January 2023 in Magazine • 7 min read • Audio availableAudio available

A certain type of family firm showed resilience in the worst months of the COVID-19 pandemic, according to a study by Alfredo De Massis and Ivan Miroshnychenko. Here they explain their findings, which they hope will contribute to the debate about how to deal with any future crisis. 

Family firms may receive less attention, particularly in the financial media, than their non-family counterparts. But that doesn’t mean that they are any less important or impactful.  

On the contrary, the heft of family firms in the global economy can be seen in the fact that they account for two thirds of all businesses worldwide and employ around 60% of the global workforce. Moreover, family firms have a well-deserved reputation for having generally survived tough economic times and for doing well over very long periods. 

Much of this can be attributed to the long-term orientation of family firms, rooted in their commitment to maintaining the business across generations. This is what has led many studies to show that family firms are more resilient than their non-family counterparts in normal economic times. 

But the question of whether a family firm’s superior ability to deal with adversity holds when facing something as challenging as a global health crisis has remained largely unexplored, except for a few single-country studies. This makes it even more interesting to look at family firms when it comes to examining their ability to respond to and recover from environmental shocks like the COVID-19 pandemic. 

Financial resilience  

To that end, we conducted a global study of 3,351 publicly listed family and non-family firms in 10 industrial sectors from 2018 to 2021 and came to a few significant findings. 

Chief among them was that the share prices of publicly listed family firms led by descendants of the founding family were not as significantly affected as those of publicly listed, non-family firms during the pandemic. 

Specifically, the share prices of the descendant-ledpublicly listed family firms outperformed those of their non-family publicly listed counterparts by an average of 8.7% in the first six months of the pandemic.  

Our findings challenge a view argued elsewhere that family businesses have tended to stagnate in the face of challenges caused by the global health crisis. It turns out that their long-term outlook, among other attributes, is a boon when times are bad

In addition, there was some evidence that firms with strong family involvement either in management or in both management and ownership on average demonstrated better resilience, as measured by the performance of their share prices, during the COVID-19 crisis than non-family firms.  

This indicated that certain publicly listed family firms were better equipped to respond to and recover from the shocks caused by the pandemic than non-family firms, and that a long-term orientation can indeed help to absorb environmental shocks.  

Our findings also challenge a view argued elsewhere that family businesses have tended to stagnate in the face of challenges caused by the global health crisis. It turns out that their long-term outlook, among other attributes, is a boon when times are bad. 

To our knowledge, this is one of the first studies to show that some family firms are better able to withstand the financial hardships caused by the pandemic. It also highlights the importance of businesses having a concentrated ownership structure with long-term goals. 

Three key characteristics 

The long-term orientation of family firms can be seen as being founded on three characteristics or concepts: futurity, continuity, and perseverance. These allow family firms to prioritize long-term business goals and means they are better equipped to face business adversity. Together, they offer insights into how family firms can navigate big external shocks. Let’s take each in turn.  

Futurity has to do with a firm’s ability to forecast and anticipate the consequences of business decisions in the long term. A family’s tendency to view the business across generations is a clear example of futurity, since it is bound up with the family’s desire to pass the business on to the next generation, which in turn means the family maintains long-term involvement. 

Another example of futurity in family business is the presence of a strong family vision, centered on the idea of generating a better future for the family, and which the controlling family develops and renews over time. This is rooted in a vision that the business will continue to operate, growing at a rate the family expects, and generating the desired financial outcomes.  

Continuity reflects the firm’s preservation and durability over time. The tendency of family firms to have close ties with the communities and local markets in which they were founded — in contrast to non-family firms, which easily can and do shift their operations from one market to another — can be a source of competitive advantage for family firms.  

Firms like these tend to keep investing in the future of the business, strengthening relations with employees by providing generous training programs and by building lasting links with external stakeholders. This can help family firms develop a distinct and durable brand that includes not only family members but external stakeholders, such as workers, financers, suppliers, and customers.  

In addition, family firms tend to expend enormous financial resources on business renewal through things like new products and expanding into new markets. Family firms typically invest in long-term innovation projects, favoring the potential economic benefits associated with attractive growth opportunities. The combination of futurity and continuity appears to enable family firms to adapt to times of adversity, allowing them to take advantage of business opportunities and cope with uncertainty. 

Perseverance comes from family firms’ exceptional emotional and financial commitment to the business, very much as a shared family concern. It also helps them develop strong responsibility toward the local community by creating robust, environmentally friendly, employee-friendly, and socially friendly policies and business practices.  

This high level of commitment in turn helps family firms to break into new markets and generate higher profit margins by moving into areas where consumers are willing to pay extra for responsible products and services. The fact that family firms are often perceived as trustworthy, and driven by quality considerations, is a big advantage. 

The conclusion that family firms exhibit perseverance over time is also likely to guarantee them better access to financing which is an additional factor that may explain why many overcame financial difficulties during the pandemic. 

The practical implications 

It follows from all this that non-family firms should reflect on these findings, and act. Owners, managers, and advisors should consider strengthening the resilience pillar of their corporate strategies to keep up with competitors and ensure long-term sustainability. Investors, too, must pay attention to a firm’s ownership and management structure in evaluating its resilience — or otherwise — to future crises.  

Moreover, our results warrant caution in relying on the presence of the founder, or founders, on the company board as being more beneficial for performance as compared with the presence of heirs. Indeed, we find that this is not the case. The presence of both is equally good for financial performance in economically challenging times. 

There are even implications for policymakers, too. Our results suggest that when governments develop and implement pandemic-related financial support programs for businesses, they need to consider that the programs most suitable for family and non-family firms vary, due to the differing ability of both types of firms to be financially resilient in a time of crisis.  

Family-owned firms (where the family holds more than 5% of equity) are likely to require more financial support, while family-managed firms (where the family holds less than 5% of equity and the CEO is a family member) and family-owned-managed firms (where the family holds more than 5% of equity and the CEO is a family member) need less, because family-owned firms demonstrated less resilience (as measured by the performance of their share prices) than family-managed and family-owned-managed firms. Consequently, our findings show that family-owned firms need more financial support than others. 


We used a longitudinal sample of 2,597,534 firm-day observations for 3,351 listed firms in 33 countries and 10 industrial sectors over the period from 11 September 2018 to 9 September 2021.  

We used publicly available data (annual reports, firm presentations, SEC filings, and press releases) collected by NRG Metrics’ Family Firms dataset, as well as financial and accounting data from Thomson Reuters Eikon, which we collected. COVID-19 data derives from the COVID-19 Data Repository of the Center for Systems Science and Engineering at Johns Hopkins University.  

The largest share of publicly traded firms is from the US, UK, Australia, and Canada (47%), European (38%), and Asian countries (12%)  

Sectors: industrial (around 27%), consumer services (15%), consumer goods (14%), basic materials (10%), and technology (9%). 

We have shown, through a rich body of evidence collected from around the world, that certain family firms are more resilient than their non-family counterparts when facing environmental shocks.  

We identified in our research variations across different types of family firms, countries, and industries. Family involvement can bring value to the firm in adverse economic times, but this effect depends on the type of family involvement in the firm.   

We hope we have provided fresh understanding of the resilience dynamics across different types of family businesses and set an agenda for future research on the drivers of resilience of family-managed firms to environmental shocks worldwide.  

We also hope our study may contribute to debate in regulatory, business, and academic communities about policy responses to the pandemic.  

By identifying the impact of family involvement on financial performance during the pandemic, as well as the most resilient types of family business, we intend to provide important new evidence for policymakers, assisting the implementation of fiscal and economic policies for COVID-19 recovery worldwide, particularly for firms with different ownership and management structures.  


Alfredo De Massis

Alfredo De Massis

Professor of Entrepreneurship and Family Business

Alfredo De Massis is ranked as the most influential and productive author in the family business research field in the last decade in a recent bibliometric study. De Massis is an IMD Professor of Entrepreneurship and Family Business at IMD where he holds the Wild Group Chair on Family Business and works with other universities worldwide.


Ivan Miroshnychenko

Research Fellow and Term Research Professor at IMD Business School

Ivan Miroshnychenko is Research Fellow and Term Research Professor at IMD Business School, and Affiliate Research Fellow at Sant’Αnna School of Advanced Studies (Italy). He carries out research on economics and management of family business and sustainability that has been published in top academic journals.



Learn Brain Circuits

Join us for daily exercises focusing on issues from team building to developing an actionable sustainability plan to personal development. Go on - they only take five minutes.
Read more 

Explore Leadership

What makes a great leader? Do you need charisma? How do you inspire your team? Our experts offer actionable insights through first-person narratives, behind-the-scenes interviews and The Help Desk.
Read more

Join Membership

Log in here to join in the conversation with the I by IMD community. Your subscription grants you access to the quarterly magazine plus daily articles, videos, podcasts and learning exercises.
Sign up

You have 4 of 5 articles left to read.