Results of the project “Shareholder loyalty in family businesses”

For family businesses, their own shareholders represent an important but also sensitive resource. In the positive case, they are available to the company with their expertise, their labour or their assets. In the negative case, they can jeopardise the existence of the company as a family business through disputes among themselves or by selling their own shares. To prevent the latter from occurring, it is important that the shareholders do not see the assets tied up in the company as a simple investment that they compare with other investment opportunities purely from a return perspective. It is crucial that the shareholders also feel emotionally attached to the company so that they hold on to their investment and make a positive contribution, especially in times of crisis. The loyalty of the shareholders to the family business is therefore an important factor for the success and long-term survival of family businesses. But how can this shareholder loyalty actually be achieved? Is it possible to increase shareholder loyalty through the targeted use of retention measures? How different are the retention measures in companies with several hundred family shareholders, as is the case in some German family businesses, compared to companies with only a handful of family shareholders?

The aim of this study is to identify correlations between the personal attitudes of shareholders, shareholder satisfaction, loyalty to the company and measures taken by companies to increase shareholder loyalty. The focus here is on the question of whether measures that companies offer to increase shareholder loyalty can lead to an increase in loyalty to the company. Furthermore, the results of the study provide insights into the optimal design of shareholder retention measures. In order to analyse the questions posed, a survey was conducted among shareholders of family businesses. A total of 301 shareholders took part in the survey. The number of shareholders in the family businesses surveyed varied between 1 and over 300 shareholders.

The results of the study will be presented to the general public at an event at the University of Mannheim on 12 March 2018.

Annegret Hauer

Dr Detlef Keese

Dr Marie Oehme

Dr Jan-Klaus Tänzler

Prof Dr Michael Woywode