So are family firms more sustainable? On the economic, social and environmental sustainability of family SMEs

In this work, we address the conflicting results that appear in the literature regarding whether family firms are more or less sustainable than nonfamily firms in each of the three dimensions, by focusing on the group that has been largely disregarded: small- and medium-sized family firms (family SMEs). We set a number of hypotheses, which we test in a sample of Spanish manufacturing firms in the food and beverages sector, using structural equation modelling. We conclude that competing arguments coexist both in favour and against these firms being more or less environmentally and economically sustainable, which finally balance themselves out. However, we found out that family firms tend to take greater care of their closer stakeholders, which, together with the importance given to their social relations with external stakeholders, make them champions in terms of social sustainability. Our results show that family firms are able to be more socially sustainable without having to compromise their economic performance in the long term. Finally, as family firms are not an homogeneous group, we analyse whether our results are firm specific, taking into account the role that the number of generations that the family has run the business and the number of generations currently involved in the business exert on firm sustainability, thereby reaching at very interesting conclusions.