Counting on Family? Leadership Team Composition of Firms with Rural Origin Founders in China
04 Oct 2023 (Wed)
10:00am – 11:30am
LSK Rm5047
Prof. Rose Xiaowei Luo, INSEAD

This study explores how socially discriminated firm leaders use family to overcome their market disadvantages. In the context of China, we examine founding leaders with rural family origins—rural founders, who face discrimination in China’s urban–rural chasm. Drawing on the family embeddedness perspective, we argue that rural founders are more likely to use family members on leadership teams, and that the use of family members is more likely to contribute to firm performance for rural founders. Using data on Chinese privately founded listed firms, we find support for our arguments. Our study offers novel insights and evidence about how family embeddedness can help socially discriminated firm leaders address market disadvantages and gain competitive performance.