The Founder’s Authority, Succession And Corporate Performance

As an important part of the market economy, the family business has always been a good performance. With the continuing development of economy, the family business gradually goes into the peak of the inter-generational transmission, involving a rank of issues such as the outgoing founders and reconstruction of the successors’ authority. This paper focuses on the listed family firms’ intergenerational transmission process, the founder of authority how to play its role, and how to impact business performance. Based on the literature review, this paper firstly analyzes the impact of inner mechanism of the founders on corporate performance. Then, the paper came up with the corresponding research hypothesis on the basis of the impact of intergenerational transmission process and authority founder. What’s more, this paper studied the listed family firms between 2008- 2014 by the regression model, and ultimately draw the following conclusions :( 1) generally speaking, the founder of authority has a positive impact on corporate performance;(2) the functions of the formal authority are significant positive correlation with corporate performance, whereas it is not significant after the tradition;(3) founders’ functional authority has positive impact on corporate performance before the heritage, but it only comes into play when founders are still involved in the company after the heritage. Results of this study show that, after the heritage, founder’s continuing involvement in the family business can release the decline caused by intergenerational transmission, but founders should also avoid excessive use of experts’ authority to intervene business decision-making.