Shaping legacy – securing the future: Family businesses benefit from a balanced legacy
A new study by the WIFU Foundation at Witten/Herdecke University examines the importance of family legacy for the long-term success of family businesses.
Family businesses are designed for the long term - but how can values, identity and tradition be preserved across generations without slowing down future-proof innovations? A broad-based study by WIFU researchers Matheus Franco and Thomas Clauß provides the first empirically sound answers to this key question.
The study "The role of legacy in family businesses" systematically analyses how different forms of legacy shape economic, social and ecological success. The researchers distinguish between three central legacy dimensions: (1) Social legacy comprises the passing on of values, norms and narratives. (2) Biological legacy refers to the preservation of the family name and bloodline. (3) Material legacy describes the transmission of wealth and property.
The central result: social legacy has the strongest positive influence on corporate success. Companies with a pronounced social legacy achieve significantly better results in social, ecological and economic terms than those with a purely material or biological orientation.
The key to success is when the right legacy dimensions come together. "The numbers speak for themselves: according to our results, a combination of strong social and material legacy proves to be a superior approach," explains Franco. A one-sided focus on material aspects, on the other hand, can be counterproductive and even weaken corporate social performance.
The next generation also plays a special role: family businesses with a strong social and biological legacy involve their successors much more actively in key decisions. This early involvement has a measurably positive effect on the company's long-term success.
"Legacy is not a product of chance, but can be developed strategically," emphasises Franco. The study recommends specific measures such as regular legacy audits, targeted storytelling to convey values and a conscious balance between a sense of purpose and structural clarity.
Clauß adds: "A shared understanding of legacy creates orientation, reduces internal family conflicts and strengthens future viability - economically, socially and ecologically."
The practical study "The role of legacy in family businesses" is available free of charge together with other publications from the WIFU Foundation at www.wifu.de/bibliothek. For further information, please contact Dr Ruth Orenstrat (ruth.orenstrat@wifu-stiftung.de, +49 2302 8898303).
