Obtaining a strategic and competitive advantage, and surviving and sustaining a business over the years is more challenging for companies in today's complex, turbulent and competitive world, especially in the times of slower growth, lower returns, and more frequent economic crises. Among the various factors that have impact on business performance, firms' ownership structure and corporate governance, especially for family businesses, are some of the main determinant factors. Whether family ownership has a positive or a negative impact on a firm performance is a very challenging question and the answer depends on a number of different issues and complex interrelations, since family businesses have some advantages, as well as disadvantages because of their specific resources, unique skills and capabilities or competencies to gain competitive advantage and sustain their business in the future.
Considerable research conducted to date reveals mixed results regarding the relationship between family business and firm performance. Some studies argue that family business creates value and contributes positively to firm performance (Anderson & Reeb, 2003; Barontini & Caprio, 2006; San Martin-Reyna & Duran-Encalada, 2012), while others claim that family firms do not differ from others in terms of firm performance (Filatotchev et al., 2005; Poutziouris et al., 2015; Sarbah & Xiao 2015). Various factors, some of which are the type of firms analyzed, the performance measures (Sacristan-Navarro et al., 2011) and the context of each country (San Martin-Reyna & Duran-Encalada, 2012), might be the causes of the mixed results (Miralles-Marcelo et al., 2014). Nevertheless, there is a general assumption that family ownership positively affects firm performance because of its uniqueness (Gurarda et al., 2016). Resources, skills and capabilities of family businesses developed over the years can provide such uniqueness (Sarbah & Xiao, 2015). The firms that use those resources, skills and capabilities efficiently to obtain the desired results would have superior performance over other firms (Kahveci, 2011; Kahveci, 2012) and reach sustained competitive advantage. In other words, unique resources, skills and capabilities of family businesses would enable them to exploit opportunities to implement strategies to reach desired performance.
Family businesses play an important role in both developing and developed countries' economies by contributing economic growth and wealth, creating employment and providing flexibility with their entrepreneurship skills. Therefore, exploring the relationship between family business and firm performance has significant importance in order to understand its remarkable role in the economy and its contribution to it. Few empirical studies investigate the determinants of the ownership-firm performance interrelationship in family-controlled but publicly listed firms, despite the fact that a large proportion of listed firms are owned and managed by family members in many developed and developing countries (Piesse et al., 2007). Almost 95% of the companies are family business in Turkey and only 3% of them can be transferred to the fourth generation. Therefore, business performance is very important for family businesses and the corporate governance has a very significant role in their sustainability. That is the main reason of this study to explore and seek to advance the family business empirical researches by investigating the family business and firm performance; family business and corporate governance relationship in the Turkish corporate governance index (XKURY) of Borsa Istanbul (BIST) firms. It is very fortunate that BIST has a XKURY index firms which is dedicated to best corporate governance firms, so it will be easier to look for both family business performance and corporate governance relationship with family business. By looking at the family business performance of those companies is a new approach to the issue and will provide a new insight in terms of both theoretical and practical results, since those firms are large publicly traded companies and have good corporate governance applications.
Several different definitions of family business, from owning the biggest percentage of shares or having a controlling interest in the firm (Sarbah & Xiao, 2015), to having a seat on the board of directors (Oudah et al., 2018), from being a CEO and co-founder to having a percentage of ownership rights (Barontini & Caprio, 2006), exist in the literature. Shares in most large firms are relatively more diverse shareholder structure such that although the largest shareholder holds a modest stake in the company rather than a large block, it can still be a family business. Therefore, there is a general consensus that family firms are those where a family owner exercises much influence or have control over the firm's affairs (Gomez-Mejia et al., 2011; Miralles-Marcelo et al., 2014). In other words, if a company is not fully owned by a family, but the family still controls the company, or has a control in management, this means that the company is still a family business, although the company has a widespread ownership structure.
In today's world of increased competition, with their unique and inimitable capabilities that provide sustained competitive advantage and superior performance over their competitors, family businesses can be more flexible, more adaptive and more cautious in spending, in investing and in doing business. When family members lead their business, they can easily monitor the business by holding a managerial position, report more employment and revenue growth and achieve higher performance (Pearson et al., 2008). In addition, when family members are participated in the firm management, they perform with a higher commitment because they perceive the firm performance as their own welfare (Gallucci et al., 2015; Ward, 1987). Family involvement, thus, enables family members to access to the firms' internal information flows and to monitor the firm easily. It also reduces information asymmetries, generates unusual motivation, and provides incentives that encourage agents to act in the owners' best interests and associate it with own wealth, translating that into better economic and financial results for the firm.
We identify the main capabilities and skills, which provide uniqueness, thus enable family business to gain competitive advantage, are leadership, family business values and corporate governance.
Leadership is the process of helping individuals to increase their capacity with knowledge and capabilities to accomplish the desired objectives by coaching them to understand and accept what needs to be done and how it is to be done. In this regard, the founder, or the leader, of a successful family business is presumed to have great leadership skills. He or she plays a vital role in teaching and training other family members so that they will have the knowledge and skills to become a competent and effective leader required to lead and to continue the business in the next generation (Cater & Justis, 2010; Dyck et al., 2002). One of the reasons why leadership is a unique capability in family business is that leaders in family business share their knowledge with the members contrary to leaders in other organizations are reluctant to do so (Oudah et al., 2018).
Family business values are defined as clear and desirable goals and norms for both family and business. Some families have also a family constitution that defines all values, family and business norms. Family business values serve as a common ground to solve the problems, deal with the conflict of...