When the Daughter Joins Family Firm. Staffing, Adverse Selection and Organizational Justice in Family SMEs

This article provides empirical evidence to support the Agency Theory as applied to small and medium-sized family firms. The research, conducted on a sample of family SMEs (N = 88), has investigated: the career path of son/daughter, the match between job assignment and agent skills, the relevance of agent's job for organizational purpose, using a qualitative method.This research suggests that altruism of the Principal as a parent and widespread adverse selection are confirmed phenomena typical of family SMEs, especially when agent is the Principal's daughter. In addition, the research highlights the implications in terms of perceived organizational justice on the part of employees who are not members of the family. Finally, this article suggests the causes and reasons for such altruistic and opportunistic behavior