No heir apparent? Exploring the workers' co-operative model as a solution to the continuity of family businesses
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Published version
Date
2017-12
Authors
Murphy, Linda
McCarthy, Olive
Carroll, Bridget
Journal Title
Journal ISSN
Volume Title
Publisher
European Research Institute on Cooperative and Social Enterprises
Published Version
Abstract
Family businesses, with no apparent heir, face the risk of discontinuity. While a number of family businesses rely heavily on non-family employees, the role of non-family employees in the continuity of family businesses is under-researched. The workers’ co-operative model offers one way to address this gap as it represents a model whereby non-family employees gain a stake in ownership whilst the family remains involved. In practice, conversion to ensure continuity is actively promoted in a number of countries. In this paper, the authors explore the role of the workers’ co-operative model as one possible solution to succession difficulties facing family firms. Based on the reported experiences in a number of countries, we identify the motivations behind conversion, the barriers faced and the benefits accruing. We find that, in theory, the worker co-operative model merits the attention of family business scholars as a means of securing continuity and survival of family business. We explore the factors that appear to aid or hinder successful conversions in practice and we make recommendations to policy-makers surrounding the supports required to encourage and facilitate successful conversion.
Description
Keywords
Workers co-operative , Family business , Business succession , Conversion , Continuity , Succession
Citation
Murphy, L., McCarthy, O. and Carroll, B. (2017) 'No heir apparent? Exploring the workers' co-operative model as a solution to the continuity of family businesses', Journal of Entrepreneurial and Organizational Diversity, 6 (2), pp. 20-39. doi: 10.5947/jeod.2017.008