Are some family firms more cautious than others when expanding abroad? Research has long offered mixed answers to this question. A new meta-analysis by WU Vienna now brings clarity to the debate. Drawing on data from around 33,500 family firms, most of them based in Europe, the study shows that differences in management structures – such as the composition of the top leadership team, the generation in control, and the cultural context – play a decisive role in determining how extensively family firms internationalize. For countries like Austria, which are strongly shaped by family-owned businesses and oriented toward exports, the findings offer valuable insights for corporate practice and economic policy.

Family leadership can slow down international expansion

“You can’t treat all family firms as a single category. But one thing is clear: Firms in which family members hold key operational leadership positions tend to be less internationally oriented,” says Ilaria Gallegati, Assistant Professor at the Institute for International Business at WU Vienna.

When a family member serves as CEO, family firms expand abroad less extensively. A board dominated by family members also has a negative impact. The reasons are varied. “In complex situations, family firms often rely on affect‑based decision-making that prioritizes the home market,” Gallegati explains. At the same time, she emphasizes, “There is substantial variation depending on the cultural context in which family firms operate.”

The culture of the home country matters

Beyond internal family governance, the cultural context of the home country also plays a central role. “Family firms never operate in a vacuum,” notes Gallegati.

In countries where family ties carry particularly high social value – such as Italy – family‑centric behavior within firms is viewed as normal. External stakeholders like investors and business partners are accustomed to these dynamics and handle them well.

In more individualistic countries, such as Germany, the same internal governance structures can hinder international expansion. External stakeholders tend to be less tolerant of emotionally driven decision-making, and conflicts between family and nonfamily stakeholders might arise more quickly – which slows down internationalization efforts.

Implications for companies and economic policy

“For export‑driven economies like Austria, our results provide important starting points for both business practice and public policy,” explains co-author Professor Florian B. Zapkau. The findings show that family firms can actively strengthen their international capabilities by adjusting internal governance structures – for example by professionalizing their leadership, bringing in external expertise, and deliberately remodeling their corporate culture.

“The key is to clearly separate family affiliation from business decision‑making,” Gallegati stresses. This includes, for example, filling positions based on qualifications rather than kinship.

At the same time, the study highlights that cultural conditions in the home country shape everyday business practices. “If we want to support the internationalization of family firms, we need to take these differences seriously,” says Gallegati.

Reference

Gallegati, I., Majocchi, A., & Zapkau, F. B. (2026). Family Governance and Home Country’s Family Collectivism in Internationalization: A Meta-Analysis of Family Firm Heterogeneity. Entrepreneurship Theory and Practice, https://doi.org/10.1177/10422587251401186