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Thomas Hagmann

Understanding the impact of active owners in privately held businesses


This thesis argues that a behavioral perspective can help explain what really happens when owners in family-owned businesses take an active role in long-term development. It addresses the gap in the relevant corporate governance and strategy literature regarding the value-creating role of owners in long-term firm development and the under-researched workings of active ownership in privately held companies. The organizational behavior theories underlying this thesis are organizational decision makingorganizational social capital, and organizational identity theory.

A pilot study and four case studies, with a total of twenty-one semi-structured interviews, were conducted to find empirical evidence for the thirteen propositions of the initial framework. Qualitative content analysis was used as a data analysis method. Based on the empirical findings, a revised conceptual framework with twelve revised propositions was created. It contributes to our understanding of the effects and mechanisms of active owners, thus contributing to opening the black box of active ownership in private companies. This exploratory study enriches the previous body of research by providing a novel understanding of the role of active owners from a strategic management perspective, a novel conceptual framework for active owner involvement based on a behavioral perspective, and a comprehensive set of propositions based on the commonly accepted concepts of organizational decision-making, organizational social capital, and organizational identity. Further research would be needed to test the revised framework statistically.

The thesis offers five initial practical implications and potential recommendations for active owners and managers working in active-ownership privately owned companies.