Winner of CM Division Best Paper Award - New Directions
Family firms are known for emphasizing profitability, growth, and market share. However, the rising environmental concerns pose a unique challenge as prioritizing environmental sustainability may impact profitability. This study, based on the resource-based view, explores data from Australian family firms’ CEOs and senior managers through separate surveys. Our analysis shows that participative decision-making in family firms positively influences the adoption of sustainable innovation practices, leading to high levels of both financial and environmental performance, termed hybrid financial-environmental performance. Notably, this relationship depends on TMT heterogeneity and family member involvement in the TMT. These findings contribute to the literature on sustainability in family firms and offer valuable insights to those seeking to balance financial success and environmental responsibility.