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Philanthropy in Family Enterprises: A Review of Literature

Family Business Review
1 –21
© The Author(s) 2015
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DOI: 10.1177/0894486515610962
fbr.sagepub.com
Review
In its most general sense, philanthropy encompasses
behaviors and actions that are manifestations of a voluntary
commitment to the well-being of others (Schuyt,
2010). Philanthropy is rooted in cultural and religious
teachings regarding the responsibilities that those more
fortunate have toward others who are less fortunate or are
going through a hard time (Rey-Garcia & Puig-Raposo,
2013; Schuyt, 2013). As important actors in their communities,
family enterprises have always been at the forefront
of philanthropic efforts (Astrachan, 1988; Sanborn &
Portocarrero, 2003) and represent an important percentage
of the monetary contributions toward the well-being of
their communities. For example, in the United States,
donations from corporations and foundations, many which
are family-owned, represent over US$67 billion per year
(National Philanthropic Trust, 2013). In the United
Kingdom, the top 100 family foundations and corporations
contribute £908 million per year to societal causes
(Pharoah, 2008). In Italy, family foundations contribute
about €90 million and in Germany, they contribute an estimate
of €490 million per year to societal improvements
(Pharoah, 2009; Pharoah, Jenkins, & Goddard, 2014).1
Therefore, the philanthropic efforts of family enterprises
provide valuable economic resources for social services,
education, health, arts, and humanities around the world.
In family enterprises, philanthropic activities also affect
the donor business and the owning family. On the business
side, philanthropy serves as a mechanism to demonstrate
commitment to long-term goals (Campopiano, De Massis,
& Chirico, 2014), to develop social and reputational capital
(Cruz, Larraza-Kintana, Garcés-Galdeano, & Berrone,
2014), and to enhance the commitment and involvement
of family and nonfamily employees toward the firm
(Muller, Pfarrer, & Little, 2014). On the family side,
engaging in philanthropy helps educate family stakeholders
on issues about family legacy, wealth (i.e., management
and responsibilities), and the practice of professional
skills required in the business world (Breeze, 2009;
Eichenberger & Johnson, 2013; Ward, 2009). Philanthropy
can also help families transfer social capital between generations
by allowing different generations to interact and
work toward a common goal (Breeze, 2009; Schwass &
Lief, 2008). Given the important role that family enterprise
philanthropy plays for the entrepreneurial family and
the business, it is important to have a baseline understanding
of the philanthropic process. This knowledge can help
610962FBRXXX10.1177/0894486515610962Family Business ReviewFeliu and Botero
research-article2015
1ESADE Business School, Barcelona, Spain
2Lansberg Gersick & Associates, New Haven, CT, USA
3Stetson University, DeLand, FL, USA
Corresponding Author:
Isabel C. Botero, Department of Management, Stetson University,
421 N. Woodland Boulevard, Unit 8398, DeLand, FL 32723, USA.
Email: ibotero@stetson.edu
Philanthropy in Family Enterprises: A
Review of Literature
Neus Feliu1,2 and Isabel C. Botero3
Abstract
Philanthropy in family enterprises operates at the crossroads of family, business, and society. Most of the research
in this area is approached from the business or the individual level; thus, we have a fragmented understanding of
philanthropy in family enterprises. This article presents a systematic review of the literature on the subject. Based on
55 sources published between 1988 and 2014, we explain the drivers of this behavior, the vehicles used to practice
it, and the outcomes tied to the practice of philanthropy in family enterprises. We identify gaps in our understanding
and provide ideas for future research.
Keywords
philanthropy, giving, business families, family business, family enterprises
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2 Family Business Review
academics and practitioners understand how philanthropy
in the family enterprise works and how it is used as a tool
for the transfer of knowledge, resources, and ideas between
and across generations.
Philanthropy in family enterprises is interesting because
it can be practiced and governed from either the business or
the family domains. This dual nature has led to a fragmented
understanding of the topic that is rooted in three characteristics
of research in philanthropy and family enterprise. First,
philanthropy has been conceptualized in different ways
(Gautier & Pache, 2015). For example, some argue that it is
a responsibility that businesses or business families have
toward society, while others suggest that it is a purely altruistic
behavior (Liket & Simaens, 2015; Saiia, Carroll, &
Buchholtz, 2003; Sulek, 2010). As a result, determining
what to include and exclude under the concept of philanthropy
is difficult. Second, there is a divide in family enterprise
research between work that focuses primarily on the
family system and on the business system, with very few
researchers integrating these two approaches (Michael-
Tsabari et al., 2014). This is problematic when studying philanthropy
in family enterprises because a complete picture
can only be obtained through the combination of research
from both systems. Third, research in family enterprise
shows little integration between practitioner and academically
driven work (Gersick & Feliu, 2014). This causes difficulty
in understanding philanthropy because academically
driven work tends to focus exclusively on the business component
of the enterprise, whereas practitioners will focus on
the family component (Michael-Tsabari et al., 2014).
To address these issues, this article provides a comprehensive
review of the literature to develop an understanding
of philanthropy in the family enterprise and
identify gaps for future research. This review focuses on
four questions in the context of family enterprises:
Research Question 1: How is philanthropy
conceptualized?
Research Question 2: What are the motivations for
philanthropy?
Research Question 3: How is philanthropy
practiced?
Research Question 4: What are the outcomes associated
with philanthropy?
The unique contribution of our review lies in the combination
of knowledge that is family-centered, business-
centered, practitioner-driven, and academically
driven to provide an examination of the topic. The following
sections present the scope of this review, general
observations about this research, findings in each
of the four research questions, general conclusions, and
directions for future research.
Scope of the Review and Coding of
Information
Databases from business and social sciences (i.e.,
EBSCO, JSTOR, Springer Link, Emerald, Science
Direct, Wiley, Sage Publications, ProQuest, and Google
scholar) were used to identify academic and practitioner
publications for this review. Sources were identified
using a combination of the following terms in the title,
the abstract, and/or the keywords for each database: philanthropy,
philanthropic, philanthropic giving, and
charity with family business, family firm, family enterprise,
business family, and family. Initially, there were
130 distinct sources. After reading each abstract and
eliminating irrelevant entries, 48 articles and 1 book
chapter were retained. Five reports that provided information
on surveys conducted with family business owners
regarding philanthropic practices and motives (The
Institute for Family Business [the United Kingdom], the
Centre for Charity Effectiveness [the United Kingdom],
Credit Suisse [the United States], Center for Charitable
Giving and Philanthropy and the Philanthropic Initiative
[the United Kingdom]) were also identified. Finally, one
book that focused on philanthropy in family enterprises
was also included. In total, this review is based on information
obtained from 55 publications2 (see the appendix,
for a list of sources).
Once publications were identified, a five-step process
was used to code the information. First, the general
information about the publication was identified. This
included publication year, author, journal, type of article
(i.e., academically vs. practice driven), unit of analysis
(i.e., family, business, or both), origin of information
(United States vs. other countries), focus of research
(i.e., comparison of family firm vs. nonfamily firm, or
family firm), research question, and general results or
observations. Second, the definition (if any) and the
measurement metric for philanthropy used in each study
were coded. Third, the reasons given for why family
enterprises engage in philanthropy were identified. This
section also identified which theoretical explanations (if
any) were used to describe these motivations. Fourth,
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Feliu and Botero 3
the specific practices employed by family enterprises to
engage in philanthropy, and the level (individual, family,
and/or business) through which philanthropy was
practiced were identified. And, fifth, the empirical findings
about predictors and outcomes associated with philanthropy
were coded. To ensure consistency in the
coding of information, the two authors independently
coded each article. The codings were then compared.
When inconsistencies arose, the coders discussed the
information, resolved their differences, and made a joint
determination about which coding to use.
What Do We Know About Research on
Philanthropy in Family Enterprises?
The first article that emerged from our literature search
appeared in 1988 (Atkinson & Galaskiewicz, 1988).
During the 1990s, there were 10 articles that explored the
subject. This included a special issue in Family Business
Review that examined family foundations (seven articles).
Since 2004, the interest in philanthropy in the family
business context has grown steadily, mirroring the
increased interest in corporate philanthropy (Gautier &
Pache, 2015). The focus in the exploration of philanthropy
has been balanced between family (N = 25) and
business (N = 24) contexts with a small number of publications
focusing on both (N = 6). Information about philanthropy
seems to be equally driven by academic (N =
28) and practice-oriented knowledge (N = 27). Thirtyfour
publications in this review were empirical studies.
The methodological approaches to collect empirical
information included the use of secondary data (N = 11),
survey research (N = 9), case studies (N = 8), in-depth
interviews (N = 4), and focus groups (N = 2). Finally,
only 33% of the publications provided information about
philanthropy from outside the United States.
While coding for definitions, we analyzed how philanthropy
was measured. Nineteen of the sources discussed
the metrics for assessment of philanthropic activities,
which included (a) monetary contribution (N = 8), (b)
other forms of support or involvement in the community
(N = 5), (c) dummy variable (i.e., asking whether the family
enterprise practiced philanthropy; N = 3), and (e) using
scores from databases (i.e., KDL and CSRHub, N = 3).
Only four of the practice-driven forces directly measured
philanthropy. One measured it as a form of support, while
the other three measured it as monetary contribution.
Defining Philanthropy in Family
Enterprises
There are many conceptual and empirical debates about
what constitutes philanthropy (Gautier & Pache, 2015;
Liket & Simaens, 2015). The source of these debates is
closely linked to changes in the definition of philanthropy
over time and the interpretations that individuals
have of what constitutes a philanthropic act (Sulek,
2010). Before the 20th century, the terms philanthropy
and charity were used interchangeably to signify the
voluntary act of financial giving to support those who
had fallen on hard times (Schuyt, 2013). This traditional
view focused on helping the less fortunate and making
sure that their basic needs were met (Schuyt, 2013).
Early in the 20th century, as wealthy entrepreneurs in
the United States started donating to a variety of causes
that went beyond welfare and relief for the poor, the
view of philanthropy shifted in at least three ways
(Harvey, Maclean, Gordon, & Shaw, 2011; Rey-Garcia
& Puig-Raposo, 2013). First, the types of causes supported
by philanthropic efforts changed from a focus on
basic physical and material needs (e.g., food, clothing,
and shelter) to a wider spectrum of causes such as health
care, environment, education, and the arts (Schuyt,
2013). Second, philanthropic efforts were no longer
focused exclusively on reducing the consequences of
social problems such as hunger or disease; instead, they
looked at ways to alleviate the symptoms of these problems
including the lack of education or of skills or a culture
of poverty (Sulek, 2010). And, third, there was a
change in the motives that guided philanthropy. Early in
the 1900s, publicists like Ivy Lee advised customers to
engage in actions that the public would perceive as good
and beneficial for society so they would be seen in a
positive light (Gruning & Hunt, 1984). This shifted the
motives of philanthropy from purely altruistic (i.e., selfless
concern for the well-being of others) to a desire for
“return on investment” in the form of public approval
from philanthropic actions or in changes in society
(Cutlip, 1994). Thus, conceptualizations of philanthropy
today go beyond the act of charity to include a wider
range of activities (e.g., donating money to social welfare,
education, or the arts) and purposes for the philanthropic
act (Aguilera, Rupp, Williams, & Ganapathi,
2007; Barnett, 2007; Porter & Kramer, 1999).
Table 1 provides sample definitions that we found in
this review. A total of 10 practitioner-focused and 23
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4 Family Business Review
Table 1. Sample Definitions of Philanthropy.
Year Author Philanthropy definition
Practicedriven
Academicdriven
“Commitment to the Common Good” approach
2000 Litz and
Stewart
Philanthropy involves giving of time and money with a charitable
purpose (implied).
×
2014 Campopiano
et al.a
Altruistic activities intended to serve others. This includes the act of
donating money, goods, and services to support a socially beneficial
or humanitarian cause.
×
2008 Pharoah Philanthropy is the voluntary giving and serving of individuals and
communities beyond one’s family.
×
“Community Investment” approach
1988 Atkinson and
Galaskiewicz
Donation to charity that is tax-deductible and serve the public good
and may or may not benefit the organization.
×
2006 Robinson Philanthropy has a long-term focus and its purpose is to establish
long-term capital funding with financial capital creating and
supporting programs for one or more initiatives. In contrast,
charitable giving is short-term focus involving a one-time donation
for a specific purpose.
×
Blended approaches
“Commitment to the Common Good” and “Community Investment”
2006 Madden,
Scaife, and
Crissman
One of the activities through which a company engages with its
community. Philanthropy is defined as the voluntary giving of money,
time, or in-kind goods by a business without any direct commercial
benefit and with the purpose of benefiting the community welfare.
×
2012 Rey-Garcia Corporate actions that are a response to societal expectations that
businesses should be good citizens. It is one of the four components
of corporate social responsibility. And, it is discretionary.
×
2014 Dou, Zhang,
and Sua
Charitable donations with discretionary responsibility of where and
how much to donate despite the society’s expectations.
×
“Community Investment” and “Marketing”
1995 File and Prince These authors equate philanthropy with cause-related marketing.
Cause-related marketing are joint ventures between nonprofits and
businesses that include giving to the community and expecting a
return.
×
aThis article was published in a family business journal.
academic publications provided a definition of philanthropy
in the text. All of the definitions described philanthropy
as a form of giving that could include financial
gifts, volunteering, or any other resource that the family
enterprise possessed. The 33 definitions explicitly or
implicitly indicated that the primary purpose of philanthropy
was to help others. Only five definitions explicitly
stated a direct benefit to the family enterprise.
The work of Gautier and Pache (2015) identifies
three general types of corporate philanthropy. The
“commitment to the common good” (CTCG) approach
views philanthropy as a voluntary and selfless act of
the organization. The “community investment” (CI)
approach encompasses philanthropic actions that can
result in some form of long-term benefit for the firm.
Finally, the “marketing” (MKT) approach views philanthropy
as a commercial tool for the organization.
We used this typology to code how philanthropy has
been defined in the context of family enterprises. Our
observations indicate that 13 publications described
philanthropy as focusing exclusively on a CTCG, 5
described philanthropy as using the CI exclusively, and
no definitions used the MKT approach. In addition, 15
publications used blended definitions of philanthropy.
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Feliu and Botero 5
Thirteen of those publications defined philanthropy
using components of both the CTCG and CI approaches
and two sources combined the CI and MKT approaches.
When comparing academic- (N = 23) and practicedriven
(N = 10) sources, we found that practice-driven
definitions were more likely to describe philanthropy
using primarily one approach (CTCG = 60%, CI =
20%) in comparison with academic-oriented sources
(CTCG = 30%, CI = 13%). Furthermore, academicdriven
sources were more likely to use blended definitions
of philanthropy (57%) in comparison with
practice-oriented sources (20%). Sixteen of these publications
described philanthropy as a component of
corporate social responsibility (CSR).
Based on the studies we reviewed and to capture the
range of conceptualizations found in the family business
literature, we define philanthropy as the voluntary donation
of resources (i.e., time, money, effort, or knowledge)
to support causes that are primarily intended to promote
the betterment of society with no direct expectation of
economic returns. Thus, we believe that the main goal of
philanthropy is to serve society. We also acknowledge
that individuals and organizations can have secondary
goals when engaging in philanthropic efforts. The next
section identifies these secondary motivations.
Motivations for Philanthropy in
Family Enterprises
Twenty-five practice-oriented and 25 academic publications
were coded to explore the motives that guide philanthropic
activities in family enterprises. We focused on
two aspects of the literature. First, the conceptual reasons
that have been related to the practice of philanthropy.
Second, the theoretical approaches, when
provided, that have been used to explain why family
enterprises engage in philanthropy. The two sections
below provide the summary of our findings.
Motives That Guide Philanthropy in Family
Enterprises
To identify the motives of philanthropy, we created a list
of all the reasons presented in each source for why family
enterprises engaged in philanthropy and grouped the
items in this list into categories. There were three general
categories: family-oriented motives, business-oriented
motives, and dual motives (see Table 2).
Family-Oriented Motives. Twenty practice-oriented and
10 academic publications provided information for this
section. Fourteen publications support the family identity
motive and suggest that philanthropy provides a
vehicle through which families can work on family
unity (Breeze, 2009; Snowdon-Blanchard, 2008), family
cohesion (Schwass & Lief, 2008), family harmony
(Zellweger & Nason, 2008), family values (Cruz et al.,
2014; Dou et al., 2014; Hoy & Rosplock, 2014; Winer,
2012), connection between generations (Eichenberger &
Johnson, 2011, 2013), and effective family processes
(Gallo, 2007; Gersick, 2006; Gersick, Lansberg, &
Davis, 1990; Robinson, 2006). In this area, there was
only one empirical study that found a relationship
Table 2. Motives for Philanthropic Efforts in Family
Enterprises.
Family-oriented motives
Family
identity
Reflects that philanthropy is important to
the family, part of its culture and identity,
and describes important values.
Legacy Highlights the family’s concern in creation,
preservation, and transfer of its legacy.
Wealth
benefits
Suggest that families are motivated to do
philanthropy because it can serve as a way
to transfer and manage their wealth.
Business-oriented motives
Strategic Highlights that philanthropy is important to
the family enterprise/business because it
can help the bottom line of the business in
the long term.
Political Guided by a desire to gain political goodwill
in the community.
Expectation Based on the desire to fulfill the
expectations of relevant others like
competitors or similar organizations.
Dual motives
Reputational Guided by the desire to develop and
preserve positive perceptions of the family
and the family business from external and
internal nonfamily stakeholders.
Moral Emerge from the good intentions of the
family and the business to contribute to
the welfare of others and achieve social
change. It is tied to the belief that “with
great wealth comes great responsibility.”
Educational Based on the concern to educate family
members about business, family,
and personal skills. The belief is that
philanthropy can serve to this process.
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6 Family Business Review
between family identity and the practice of philanthropy.
In her work with family business owners in the United
Kingdom, Breeze (2009) found that owners say they
engage in philanthropic efforts because doing so is consistent
with the values of the family.
Fourteen publications highlighted legacy factors as
important motives. These articles suggest that family
enterprises are interested in philanthropy because it provides
a vehicle to learn about what the family has done
in the past (Credit Suisse, 2010; Eichenberger &
Johnson, 2013; Prince, File, & Gillespie, 1993), and can
facilitate the involvement and knowledge exchange
between members from multiple generations (Bingham,
Dyer, Smith, & Adams, 2011; Eichenberger & Johnson,
2011; Hansen, 1990; Hoy & Rosplock, 2014; Lerner,
2011; Ward, 2009). The work of Litz and Stewart (2000)
and Breeze (2009), provides some empirical support for
the legacy motive. These studies found that family businesses
want to leave a mark in the communities in which
they operate and one of the ways of doing this is by
engaging in philanthropy. Thus, the family’s desire to
build a legacy is one of the drivers for the practice of
philanthropy in family enterprises.
Thirteen publications highlighted that family enterprises
have a desire to practice philanthropy because by
doing so, families can accrue wealth benefits (Bronfman,
2009; Gray, 2008; Hayes & Adams, 1990; Hersch, 2004;
Hoy & Rosplock, 2014; Rey-Garcia, 2012). The only
study that provides empirical support for this claim is
the work of File and Prince (1995) who found that one
of the reasons family business owners practice philanthropy
is the tax benefits they obtain. Rey-Garcia and
Puig-Raposo (2010, 2013) qualify this claim stating that
the civil law tradition of the country in which the family
engages in philanthropy can affect the tax and wealth
benefits to individuals and organizations.
Business-Oriented Motives. Three practice-driven and 14
academic publications were used to identify the different
business motives. Eleven publications focused on
business strategic reasons for engaging in philanthropy.
These motives suggest that donations help increase sales
(File & Prince, 1998), increase performance (Fernando
& Almeida, 2012; Fitzgerald, Haynes, Schrank, &
Danes, 2010), and could bring tax benefits (Zellweger &
Nason, 2008), or financial returns for the business (Lähdesmäki
& Takala, 2012; Madden et al., 2006; Niehm,
Swinnney, & Miller, 2008). Three publications provide
empirical support for this motive (File & Prince, 1998;
Lähdesmäki & Takala, 2012; Niehm et al., 2008). Political
reasons represent the second business motive
explored. Four publications discussed political reasons
to practice philanthropy. In the Chinese context, having
political connections is positively related to the practice
of philanthropy in family enterprises (Zhang, Yang,
Wang, & Wang, 2012). Chinese family enterprises also
engaged in philanthropy to divert attention from environmental
misconduct (Du, 2015). In the United States,
Atkinson and Galaskiewicz (1988) also found that the
connections that CEOs have to the philanthropic elite
would influence to whom the company decides to donate
to and how much they donate. Finally, Pharoah, Keidan,
and Gordon (2011) found that the personal contacts of
business owners play a role in the practice of philanthropy
by family firms.
Ten publications (practice: N = 3, academic: N = 7)
suggest that the expectations of others matter when deciding
to engage in philanthropy. Even though philanthropy
is not a legal, economic, or ethical obligation of the organization
(Schwartz & Carroll, 2003), there are social
expectations for a business to engage in some form of
philanthropic activity. Doing so shows the organization’s
commitment and responsibility toward their community
(Gautier & Pache, 2015). In line with these expectations,
researchers suggest that family enterprises perceive pressures
from society (Danco & Ward, 1990), stakeholders
of the firm (Prince et al., 1993), the community
(Campopiano et al., 2014), and/or peer organizations
(Breeze, 2009; Madden et al., 2006) to engage in philanthropy.
The only study that provides some empirical support
for this relationship is Breeze (2009). She found that
peer pressure was a prominent explanation business owners
gave for doing philanthropy in family enterprises.
Dual Motives. Fourteen practice-driven and 20 academic
publications discussed dual motives as a reason for why
family enterprises practice philanthropy. Thirteen publications
support reputational reasons to practice philanthropy
(Breeze, 2009; Campopiano et al., 2014, Cruz
et al., 2014; Dyer & Whetten, 2006; Harvey et al., 2011;
Rey-Garcia & Puig-Raposo, 2010). These researchers
argue that when family enterprises are involved in philanthropy,
they are seen as a positive influence in the community,
and these positive perceptions can translate into
opportunities and sources of reputational capital (Bingham
et al., 2011; Hoy & Rosplock, 2014; Schwass &
Lief, 2008; Uhlaner, van Goor-Balk, & Masurel, 2004).
The empirical support for reputational motives is limited.
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Feliu and Botero 7
Findings indicate that family enterprises whose name is
associated with the business are more likely to have concern
for the reputation of the family and are more likely to
engage in philanthropy (Breeze, 2009; Uhlaner et al.,
2004). Similarly, studies suggest that business owners
perceive that philanthropy provides visibility to the family
and the business (Breeze, 2009; Pharoah et al., 2011).
Therefore, family business owners are more motivated to
practice some form of philanthropy. However, there is no
systematic exploration of the importance of reputation
when making decisions about philanthropy.
Twenty-two publications provide information about
moral motives guiding the practice of philanthropy. This
research indicates that family firms are more likely to
practice philanthropy because they are more concerned
with helping their communities (Kranenburg & Zoet-
Wissink, 2012; Uhlaner et al., 2004), contributing to their
welfare (Lähdesmäki & Takala, 2012), benefiting society
(Rey-Garcia, 2012), giving back to the community
(Winer, 2012), affecting social change (Eichenberger &
Johnson, 2013), making a mark in the community where
the business is located (Litz & Stewart, 2000), and solving
social problems (Déniz & Suárez, 2005). However,
there is no empirical research that directly linked moral
motives with the decision to engage in philanthropy.
Finally, eight publications suggest that philanthropic
activities provide educational benefits for the family and
the business. These sources indicate that philanthropic
entities can offer a context in which family members
learn how to manage their wealth (Gallo, 2007; Gray,
2008), develop and practice management and business
skills (Credit Suisse, 2010; Hoy & Rosplock, 2014;
Schwass & Lief, 2008), and where junior generations are
educated about issues that are important for the family
and the business (Breeze, 2009; Hoy & Rosplock, 2014).
We did not find empirical publications that explored education
as a motive to practice philanthropy.
Using Theory to Explain Motivations
The second part of understanding motives focused on
the theoretical lenses used to explain why family enterprises
engage in philanthropy. There were 13 academic
publications that employed theoretical frameworks to
explain the drivers of philanthropy. These approaches
are summarized in Table 3.
There are two general observations about the use of
theory in research on this subject. First, although early
publications relied on one theory to explain the motives
for philanthropy, advances in the study of family enterprises
have led authors to combine theories to better
explain the multiple motivations toward philanthropy
(Pharoah, 2008). For example, Cruz et al. (2014) combine
organizational identity, stakeholder theory, and
socioemotional wealth (SEW) frameworks to suggest
that family enterprises behave differently toward external
and internal stakeholders. They argue that family
enterprises are responsive to the claims of external
stakeholders, and are likely to initiate actions that will
help them respond to external stakeholder needs. At the
same time, family enterprises want to act in ways that
reflect their own self-professed desires (i.e., their identity),
with SEW representing an important element of
the identity of the family enterprise. In this case, philanthropy
is seen as a practice that is directed to external
stakeholders and helps the family express their identity
to the community, show their concern for others, and be
connected to the community. Therefore, different theories
are necessary to explain why family enterprises may
have multiple motives when engaging in philanthropy.
Second, our review indicates that theoretical work
provides a rationale that is most consistent with businessdriven
motives (see Table 3). There are at least two reasons
for this focus. First, the research that uses theoretical
frameworks is conducted primarily in academia. This
academic focus results in explorations that are conducted
through the lens of entrepreneurship or business strategy
(Michael-Tsabari et al., 2014). In these disciplines, the
unit of analysis is typically the business and not the family.
Second, data about philanthropy from the organizational
perspective may be more accessible than data from
the family or individual side. Consequently, we should
expect that as interest for family enterprises research
grows in other disciplines (i.e., family studies, psychology,
sociology, or other social sciences), theoretical
works that emphasize family and dual motives are more
likely to emerge.
Moderators in the Relationship Between
Motives and Practices
In the process of coding for motives, we identified
two practice-driven and 16 academic publications
that explored characteristics that moderated whether a
family enterprise would engage in philanthropy. The
primary moderators influencing whether family enterprises
practice philanthropy were the perception of
having sufficient excess financial resources
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8 Family Business Review
Table 3. Theoretical Approaches Used to Explain Motivations for Philanthropy.
Theory Explanation References Motives
Agency In “owner-controlled firms,” philanthropy is
not seen as an agency cost because owners
may not exclusively focus on stockholders.
Atkinson and Galaskiewicz (1988);
Zhang et al. (2012)
Family identity
Strategic
Enlighted
self-interest
model
Socially responsible actions by a firm will be
reciprocated over time by support from
loyal customers, employees, suppliers, and
other stakeholders.
Niehm et al. (2008) Family identity
Reputational
Organizational
identity
Engaging in socially responsible actions is part
of the identity that firms want to project to
others.
Bingham et al. (2011); Cruz et al.
(2014); Dyer and Whetten (2006)
Family identity
Reputation
Moral
Social capital Philanthropy helps develop ties between the
business and the community that can be
valuable.
Campopiano et al. (2014); Harvey
et al. (2011); Lähdesmäki and
Takala (2012); Niehm et al. (2008)
Political
Reputation
Socioemotional
wealth (SEW)
Practicing philanthropy enhances different
dimensions of SEW that are important for
family businesses identity.
Cruz et al. (2014); Dou et al.
(2014)
Family identity
Legacy
Reputation
Stakeholder
identity
orientation
Organizations engage in philanthropy because
these actions are consistent with how the
business wants certain stakeholders to view
the firm.
Bingham et al. (2011) Moral
Reputation
Stakeholder Family firms engage in philanthropy to meet
the demands of relevant stakeholders.
Bingham et al. (2011); Cruz et al.
(2014); Fernando and Almeida
(2012); Zhang et al. (2012);
Zellweger and Nason (2008)
Expectation
Stewardship Practicing philanthropy helps the family firm
act as good steward in the community
where they work.
Campopiano et al. (2014) Strategic
Political
Reputation
Sustainable
family
business
Philanthropy enhances the interaction
between the firm and the community, which
is essential for the sustainability of the firm.
Fitzgerald et al. (2010) Legacy
Expectation
(Fitzgerald et al., 2010; Harvey et al., 2011; U.S.
Trust, 2013) and sales (Campopiano et al., 2014;
Déniz & Suárez, 2005; Dou et al., 2014; Madden
et al., 2006; Ward, 2009). Other factors that were
linked to differences in the practice of philanthropy
included the generation of the family in charge of the
business (Lähdesmäki & Takala, 2012; Uhlaner et al.,
2004), the dispersion of family ownership among
family members (Campopiano et al., 2014), the size
of the business (Déniz & Suárez, 2005; Litz &
Stewart, 2000; Niehm et al., 2008; Zhang et al.,
2012), the age of the business (Déniz & Suárez,
2005), the percentage of family ownership (Déniz &
Suárez, 2005), the degree of interest by business owners
in helping the community (Fitzgerald et al., 2010;
Lähdesmäki & Takala, 2012), and the level of
involvement of family members in the business
(Bingham et al., 2011; Litz & Stewart, 2000).
The industry in which the business operates also
affects engagement in philanthropy. Companies in industries
that promote a higher sense of social responsibility
are more likely to practice philanthropy (Madden et al.,
2006; Zhang et al., 2012). The country where the company
operates can also be considered a moderator of why
companies feel that they need to engage in philanthropy
(Rey-Garcia & Puig-Raposo, 2010, 2013). Companies in
countries with laws that promote tax benefits for giving
are more likely to engage in philanthropy. Finally, size of
the community influences the motive to engage in philanthropy
(Uhlaner et al., 2004). Being in a smaller community
may create a stronger sense of responsibility in
comparison with larger communities.
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Feliu and Botero 9
Philanthropy Practices in Family
Enterprises
Philanthropy in family enterprises is a phenomenon at
the intersection of family, business, and society. Because
of this, a unique characteristic of philanthropy in this
context is that it can be carried out through individual,
family, and corporate activities, or a combination of
practices from these levels. Building on this idea, we
explored the different vehicles used for philanthropy
and the preferences that family enterprises had toward
those vehicles. We relied on 15 practice-driven and 12
academic publications to explore these issues. Table 4
summarizes the different vehicles that family enterprises
can use to practice philanthropy, based on our sources.
We found that family enterprises were less structured
and more informal when engaging in philanthropy
(Breeze, 2009; U.S. Trust, 2013). In general, the degree of
formality in practices varies depending on the extent to
which the family business is already established, the number
of family members involved in the business, the number
of family members involved in philanthropy, the
degree of interest in philanthropy shown by family members,
the extent to which the business engages with consumers,
the type of previous experiences with
philanthropy, and the access to advice about philanthropic
giving (Breeze, 2009; U.S. Trust, 2013). For instance,
Australian and U.S. small family business owners prefer
to support local causes in their community and avoid cash
donations (Fitzgerald et al., 2010; Madden et al., 2006).
Business owners in small communities prefer to make
contributions in kind (i.e., technical help, volunteering in
the community) and are more likely to make these contributions
when community is economically vulnerable.
Although informal practices are more prevalent in the
practice of philanthropy, it is important to note that the
majority of practices detailed in Table 4 involve foundations,
which are considered formal organizations for the
practice of philanthropy. In this review, 18 out of the 27
publications investigated foundations. Given the significance
of this vehicle in the practice of philanthropy, the
section below summarizes what we found about foundations
in our review.
Foundations as Important Vehicles for
Practicing Philanthropy
Foundations are nonprofit entities established with the
purpose of making grants to unrelated organizations,
institutions, or individuals for scientific, educational,
cultural, religious, or other charitable purposes (Moody,
Knapp, & Corrado, 2011; Rey-Garcia, 2012). Family
foundations are those in which a family or some of its
members endow and play a significant role in its governance
and/or management (Brody & Strauch, 1990;
Gersick, 2006). Although family foundations are closely
Table 4. Types of Philanthropic Practices.
Practice Definition
Individual practices
Checkbook
philanthropy
Giving because someone asks.
Formative
philanthropy
Giving back to organizations that are
important to the person.
Cause
philanthropy
Supporting causes that are important for
the individual.
Family practices
Collaborative
giving
Working with a group of family members
to create a pool of funds used for
philanthropy.
Donoradvised
funds
A fund set by a private donor (individual,
family, or corporation) within one public
foundation.
Family
foundations
Practicing philanthropy through an entity
in which a family or some of its members
endow and play a significant role in its
governance and/or management.
Planned
donations
Donations that are planned and done as
a group.
Corporate practices
Foundations Supporting philanthropic causes through
a separate and independently governed
legal entity from the parent company
but maintaining close ties with it (i.e.,
contributions to maintain its giving or
reflecting the parent’s interests).
Endowments Exercising philanthropy by a donation
of money or assets to a nonprofit
organization for the ongoing support of
that organization.
Multiple levels
Charitable
trusts
A trust settled for both charitable
purposes and public benefit.
Giving circles A collective way of practicing
philanthropy, in which donors come
together, formally or informally, to
combine their resources for a cause.
Public
community
foundations
Engaging in philanthropy by irrevocably
giving funds to a chosen community
foundation.
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10 Family Business Review
associated with family business owners, it is not just
family business owners who utilize family foundations.
Individuals and families who obtained their fortune in
other ways also use foundations as a vehicle to manage
their wealth.
Family foundations have different purposes. Some
argue that family foundations are created with a focus on
social impact and family unity (Credit Suisse, 2010;
Gersick et al., 1990; Pharoah, 2008; Snowdon-
Blanchard, 2008). Others argue that family foundations
are platforms developed to educate the next generation
(Hansen, 1990) or to obtain tax exemption (Hayes &
Adams, 1990; Ottinger, 2008; Rey-Garcia & Puig-
Raposo, 2010). As a result, the purpose of a foundation
varies depending on the motivation of the family and/or
the laws of country in which the foundation is located.
Several models differentiate between types of family
foundations. A classification presented by Rey-
Garcia and Puig-Raposo (2010, 2013) suggests that
family foundations can be described based on two
models commonly used by entrepreneurial families.
The noncontrolling model is a family foundation whose
main goal is to channel the philanthropic activities of
the family enterprise in a tax efficient way. The controlling
model describes foundations that are primarily
used by the founder as a vehicle for maintaining control
over one or several family firms. Another classification
suggests that there are three models that are
relevant in foundations linked to family enterprises
(Credit Suisse, 2010, Rey-Garcia 2012; Rey-Garcia &
Puig-Raposo, 2010). The pure family model includes
those funded, governed, and managed by the family,
without any connection to the business. The pure corporate
model includes foundations that are created by
the family firm as a separate entity from the business,
and are funded through the company. The hybrid model
groups foundations that combine the components of
the family and corporate models. Current research
indicates that the pure family model is most prevalent
in countries such as the United States and the United
Kingdom, while the pure corporate model is most
prevalent in Latin America (Credit Suisse, 2010).
However, there is a limited ability to generalize from
these results because the reporting on foundations is
not mandatory in all countries and, as a result, data
about foundations are not always available (Rey-
Garcia & Puig-Raposo, 2010).
Some of the work we reviewed focused on the differences
between family and nonfamily foundations.
Authors argue that the main difference between these
two types of foundations is the degree of family control
and the influence that families can have over the management
and allocation of resources (Gersick, 2006;
Gersick et al., 1990). Research from Brody and Strauch
(1990) found that family foundations have smaller
boards, with about half of the board composed of family
members, and more female board members. They also
found that boards in family foundations have fewer limits
to terms and services, and board members spend more
time in management roles. Lungeanu and Ward (2012)
complement these findings suggesting that the generational
stage of the family and the level of family control
on the board is likely to affect the grant-making strategy
(i.e., diversification or focus of the foundation). In their
research, they find that the extent of diversification of the
family foundation is positively related to board size and
the involvement of more generations on the board.
A final topic discussed in the articles was the importance
that foundations have for family enterprises and
family systems. Foundations create a place in which the
family can learn and grow together through involvement
in multiple capacities (Breeze, 2009; Hansen,
1990). This is particularly true when foundations are
more structured in their giving and are strategic in their
approach. These two factors create more opportunities
for the learning and development of family members
(Hansen, 1990). Foundations also provide space to
work on the relationships between family members
(Breeze, 2009; Gersick et al., 1990) and can help business
owners create exit strategies after leaving the firm
(Danco & Ward, 1990).
Outcomes Associated With
Philanthropy in Family Enterprises
The final research question in this review explored the
outcomes associated with philanthropy. Although there
are many claims that family enterprises can benefit from
engaging in philanthropy (i.e., have better reputation, better
relationships with the community, better performance),
only four practice-driven and four academic publications
focused on the outcomes of philanthropy. Findings indicate
that practicing philanthropy results in enhanced family
dynamics (Breeze, 2009). Three studies examined the
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Feliu and Botero 11
business outcomes associated and found that family businesses
that engage in philanthropy have better performance
(Niehm et al., 2008), increased reputations
(Fernando & Almeida, 2012), and higher stock valuations
(Zhang et al., 2012). Other studies found that engaging in
philanthropy resulted in positive perceptions about the
family (Breeze, 2009; File & Prince, 1998), opportunities
to educate and involve family members who were not part
of the business (Pharoah, 2008; Pharoah et al., 2011), and
opportunities to encourage charitable giving by the next
generation (U.S. Trust, 2013).
Discussion and Directions for Future
Research
This article reviews the literature on philanthropy in family
enterprises over the past 26 years (1988-2014). Our
primary purpose was to create a baseline understanding
of the motivations that underlie philanthropic practices
and outcomes in family enterprises by focusing on four
general research questions. Figure 1 provides a visual
representation of what we found based on this review.
The following sections discuss our findings, the gaps in
Figure 1. Motives and outcomes of engaging in philanthropic efforts in the context of family enterprises.
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12 Family Business Review
our understanding of the topic, and provide directions for
future research.
Defining Philanthropy in Family Enterprises
In family enterprises, conceptualizations of what constitutes
philanthropy vary from traditional approaches
(i.e., philanthropy = charity) to more strategic
approaches (i.e., philanthropy has a purpose and should
produce some form of return on investment; Gautier &
Pache, 2015; Liket & Simaens, 2015; Saiia et al., 2003).
Our review shows that, conceptually, researchers in
family enterprises use a range of definitions, but most
of them highlight two important components of philanthropy:
(a) voluntary action and (b) the long-term benefits
that these actions should have for the family
enterprise. Nevertheless, there was little agreement in
the definitions as to what actions were considered philanthropic
in nature.
The lack of definitional consensus presents problems
in three areas. First, it makes it difficult to demarcate
what constitutes a philanthropic act. Not having a
clear definition leads to questions such as: Are all donations
philanthropic acts? and What types of donations
would be philanthropic in nature? Second, not having a
clear definition makes it difficult to determine the
underlying characteristics of this behavior. For example,
earlier in the text, we mentioned that one of the
main characteristics of philanthropy is that it represents
a voluntary act. One of the social expectations of society
today is to be “a responsible citizen.” Part of this
social responsibility involves volunteering and donating
time and efforts to others. In this sense, many
actions are a result of social pressures instead of voluntary
actions. This changes the characteristic of the philanthropic
act from being voluntary to being obligatory.
This raises questions such as: Does something that I
believe I have to do constitute a philanthropic act? The
third aspect that is problematic about the lack of definitional
consensus relates to the measurement of the construct.
Even when the conceptual definition is clearly
stated and appropriately multidimensional, philanthropy
has most often been measured very simplistically
(i.e., monetary contribution, dummy variables, or
CSR database scores). This simplistic assessment does
not fully capture the complexity of the philanthropy
construct. For example, if we define philanthropy as the
voluntary donation of resources (i.e., time, money,
effort, or knowledge) to support causes that are primarily
intended to promote the betterment of society with
no direct expectation of economic returns, our measurement
needs to at least include the assessment of: (a)
What was donated? (b) Were donations perceived as
voluntary? and (c) How did individuals expect that their
actions would benefit society? These three areas represent
the different facets of the definition. Therefore,
given the problems that are evident, based on the lack of
clarity in the definition of philanthropy, future research
should endeavor to clearly define what is philanthropy,
and make sure that the conceptual definition is reflected
in the measurement of the construct.
This review also shows that academics, in some
cases, tend to view philanthropy as a component of
CSR. This raises two interesting questions. First, if philanthropy
is defined as CSR, what happens when family
enterprises engage in philanthropy through family and
not business vehicles? Does this translate into family
businesses being less “socially responsible”? Second, it
raises the question of whether philanthropy is an
expected behavior for family enterprises. Although
Carroll (1979) suggests that philanthropy is a discretionary
component of social responsibility, stakeholders
believe that part of the obligation of organizations is to
engage in corporate responsible actions like philanthropy
(Gautier & Pache, 2015). Thus, if philanthropy is
a component of CSR, does it not also become an
expected behavior of family enterprise? And, if philanthropy
is expected, does this not contradict the voluntary
nature of it? Given this, we need to clarify the relationship
between philanthropy and social responsibility so
that researchers can investigate whether it is a discretionary
or an expected behavior of the family enterprise.
The need for a clear definition of philanthropy is also
relevant to differentiate philanthropy from other
approaches, such as social entrepreneurship, impact
investing, or impact capitalism, which include financial
motives and profit expectations.
Motivations for Philanthropy in Family
Enterprises
The understanding of motives is the most common
topic of research in family enterprise philanthropy. As
seen in Table 2, there are nine motives offered in the
literature to understand philanthropic behavior. Family
enterprises are likely to use combinations of these
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Feliu and Botero 13
motives when making decisions about philanthropy.
One aspect that it is not addressed by the existing literature
is how the different motives interact with each
other to explain why family enterprises engage in philanthropy.
For example, what motives are more prevalent?
What happens when family and business motives
are incompatible? Based on these questions, future
research should explore how business, family, and dual
motives combine to determine the ways in which family
enterprises practice philanthropy.
Part of the work on motivation has highlighted the
different theories of why family enterprises are interested
in philanthropy. Table 3 shows that most of these
theories focus on business-oriented motives to explain
the reasons for this engagement. This emphasis on business
indicates that future research can benefit from the
inclusion of family-oriented theories to explain the
behavior of family enterprises. Future studies should
also continue to explore how different theoretical
approaches could be combined to acknowledge that
family enterprises have multiple motives. For example,
it would be interesting to explore how the importance of
the different components of SEW to a family could
moderate the relationship between motives and how
family enterprises practice philanthropy. In a similar
way, it would be interesting to explore how the importance
that families give to their image in society can
moderate the extent to which reputational motives may
drive involvement in philanthropy. Future research can
build on work that combines multiple theoretical
approaches to understand the nuances in the family
enterprise context (see Campopiano et al., 2014; Cruz
et al., 2014; Dou et al., 2014; Zellweger & Nason,
2008; Zhang et al., 2012).
Philanthropy Practices in Family Enterprises
To date, research has focused on formal practices of
philanthropy. However, our review of the literature suggests
that there is a preference for informality when
engaging in philanthropy in family enterprises (Breeze,
2008). This raises important questions. For example,
What are the different informal vehicles that family
enterprises use? When do family enterprises shift to
formal practices? How do family enterprises combine
informal and formal vehicles to carry out their philanthropy?
What factors determine whether a family enterprise
will use a formal or an informal vehicle to practice
philanthropy? How do family enterprises decide from
which context (i.e., family, business, or ownership)
they will practice philanthropy? Building on this, the
field could benefit from descriptive work that can help
us better understand the variety of practices used as
vehicles for philanthropy and what factors affect the
shift from the use of informal to formal practices.
Empirical work can also help understand the family and
business factors that influence the choice of practices
and the factors that may influence changes in these
preferences.
Based on our observations, an underlying assumption
of the research exploring philanthropy is that family
enterprises generally represent one family and one business.
However, family enterprises can be complex systems
with multiple constituencies and subcomponents
(Chrisman et al., 2005; Michael-Tsabari et al., 2014;
Sundaramurthy & Kreiner, 2008). These ideas have
important implications in understanding how family
enterprises practice philanthropy and how these practices
evolve over time and across generations.
Entrepreneurial families3 can carry out their philanthropy
simultaneously through different vehicles at the
individual, family, and business levels. Consequently,
one important area for future research is to understand
how family enterprises with multiple businesses engage
in philanthropy.
Our review suggests that the study of foundations
has dominated our understanding of how philanthropy
is carried out in family firms. Although this research
has been informative, literature on philanthropic foundations
needs to be better integrated into our understanding
of how philanthropy is carried out in family
enterprises. This includes understanding the prevalence
of the different types of foundations (pure family,
pure business, or hybrid models). The models by Rey-
Garcia and Puig-Raposo provide a very promising
framework for exploring the international prevalence
of different types of foundations. Further work in this
area could provide insights into how different legal,
economic, and political contexts around the world can
influence how philanthropy is carried out. Another area
that would be interesting to explore is the process that
family enterprise foundations use to make decisions
about how to fund their philanthropic endeavors and
how to govern their practices. As philanthropic organizations
move toward an understanding of their impact
in society (Maas & Liket, 2010), it becomes necessary
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14 Family Business Review
to examine the processes that they use in their decision
making and governance that could influence their
impact.
Outcomes Associated to the Practice of
Philanthropy in Family Enterprises
Observations from our review indicate that the majority
of our sources focused on the drivers instead of the outcomes
of philanthropy. Thus, philanthropy was more
likely to be viewed as a dependent instead of an independent
variable. This is interesting given that many of
the arguments for studying philanthropy are based on
wanting to understand the impact of these actions for
individuals, families, businesses, or society. Given this
focus, a gap in our understanding is the limited knowledge
that we have about outcomes associated with philanthropy.
For example, at the family level, it would be
interesting to explore whether practicing philanthropy
as a family affects the relationships and dynamics
between family members and how or when this occurs.
The work of Breeze (2009) found that family business
owners felt that doing philanthropy as a family had a
positive effect on family relationships, but we do not
know what dynamics are affected or when and how
these dynamics are affected. Other aspects that need
exploration include understanding whether practicing
philanthropy helps the family manage/transfer wealth
between and within generations, and how philanthropic
practices affect the creation and transmission of the family
legacy.
At the business level, future research needs to continue
exploring the effect that philanthropy may have on
the performance of the firm. This review shows that
family enterprises need to perceive that they have a surplus
of financial resources available to invest in their
philanthropic endeavors (Fitzgerald et al., 2010; Harvey
et al., 2011; U.S. Trust, 2013). We also know that family
firms that engage in philanthropy have better performance
(Niehm et al., 2008). However, the directionality
of this effect is not clear. Therefore, we need to better
understand when does practicing philanthropy result in
increased performance, and how performance of the
firm affects the practice of philanthropy? Other issues
that require further consideration at the business level
are the impact of philanthropic practices on the level of
political influence that family enterprises have in a community,
and the level of trust that external and internal
stakeholders develop toward these firms. All of these
issues could help us better understand the benefits and
costs associated with philanthropic practices.
The study of outcomes should also focus on the perceptions
that external stakeholders have about the family
and the business and whether these perceptions can
act as sources of competitive advantage. Researchers
argue that stakeholder perceptions are important because
they can affect the legitimacy, financial performance,
and moral capital of the firm (Barnett, 2007; Chiu &
Sharfman, 2011; Godfrey, 2005). Therefore, future work
could explore whether and how engaging in philanthropy
results in positive, neutral, or negative reputations
for the family enterprise. Other areas to explore
include whether, how, and when the practice of philanthropy
helps next-generation family members develop
professional skills and capabilities, and the relationship
between the vehicle through which philanthropy is practiced
and the different outcomes.
Methodological Considerations
Our review suggests three methodological considerations
when developing future research about philanthropy.
In their work, Evert, Martin, McLeod, and
Payne (2015) highlight the importance of considering
multilevel relationships when exploring family firms.
Building on this, we believe that future researchers
can benefit from multilevel considerations when
exploring philanthropy. For example, we could study
how antecedents at different levels combine to affect
the practice of philanthropy as well as the different
outcomes associated with philanthropy. A second
methodological consideration is the lack of discussion
of the combined effects of both family and business
motives or outcomes when studying philanthropy.
Although practitioners and academics both suggest
that philanthropic activity can be motivated by multiple
family and business motives, there is no systematic
exploration of how the combination of these
motives work.
One characteristic that is generally overlooked across
all the areas of existing literature is the importance of the
cultural context to understand philanthropy. Research
about philanthropy in family enterprises has been dominated
by studies conducted in the United States. A reason
for this is that philanthropy has a longer history in
the United States where there are legal, political, and
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Feliu and Botero 15
economic policies that promote philanthropic behavior
(Rey-Garcia & Puig-Raposo, 2013). Because policies
vary across countries, these findings may not be generalizable
to other cultural contexts. This is evident when
comparing studies conducted in China (Du, 2015; Zhang
et al., 2012) with those conducted in Italy (Campopiano
et al., 2014) and in other areas of Europe (Cruz et al.,
2014) or the United States (Bingham et al., 2011; Dyer
& Whetten, 2006). Therefore, an important methodological
issue for future research is the role of cultural context
in interpreting the motives, practices, moderators,
and outcomes associated with philanthropy.
Other Important Topics in Philanthropy
A topic that has interested family business scholars is
the comparison between family and nonfamily firms.
Family firms are said to have unique competitive advantages
and characteristics that make them act differently
than nonfamily businesses (Sirmon & Hitt, 2003). An
interesting observation about research in philanthropy is
that only six studies compare family and nonfamily
firms, and four of them find no differences between the
extents to which ownership affects the practice of philanthropy
(Atkinson & Galaskiewicz, 1988; Cruz et al.,
2014; Dyer & Whetten, 2006; Niehm et al., 2008). One
of the reasons for the lack of differences may be that
these studies measured philanthropy using CSR databases,
which make it difficult to precisely assess philanthropic
practices and donations. It would be interesting
for future research to continue to explore this area and
see whether there are differences between family and
nonfamily businesses based on firm size and how philanthropy
is measured.
Another understudied aspect is how philanthropy is
funded. In the context of family enterprises, financial
resources can come directly from the business, from the
dividends to the family (and other shareholders), or from
financial resources of family members. We believe that
the way philanthropy is financed can have important
implications for what vehicle is used to practice philanthropy,
how philanthropy is governed, and which motives
and goals have priority when making philanthropic decisions.
It may be that when the funding source is the family
member, family-driven motives will be more relevant.
On the other hand, when funding comes exclusively
from financial resources of the business, business-related
motives may be more prevalent. In each of the cases, the
governance and the involvement of family in governance
issues may be different. Therefore, future research needs
to explore the financial aspect of philanthropy in family
enterprises. Governance (i.e., the process and structures
used to manage and direct the business affairs and
accountability of philanthropic endeavors; Gersick &
Feliu, 2014) of philanthropic activities is another topic
that is understudied. None of the sources in this review
talked about governance issues in philanthropy outside
of the family foundation. Given the important role of
governance, future research should explore the different
mechanisms that family enterprises use to govern their
philanthropy, and how these governance structures affect
the decision about philanthropy. This could benefit practitioners
who work with entrepreneurial families in
developing their philanthropic practices.
Concluding Remarks
Our review comes at a time when there is an increased
interest in the socially responsible actions of individuals,
families, and businesses. As family enterprises are
more involved in philanthropy, scholars and practitioners
have a great opportunity to conduct research in this
area. This review synthesizes the current knowledge of
philanthropic practices from both the academic and the
practitioner points of view to capitalize on the unique
knowledge these two areas of research bring to our
understanding of family enterprises. We summarize
how philanthropy is defined, the motives that drive it,
how it is practiced by family enterprises, and the outcomes
associated with philanthropy in family enterprises.
Despite the important contributions of the
literature in the past 26 years, there are gaps in our
understanding that need further exploration. We have
written this review to provide a road map for future
research and we hope that it will spur more interest in a
phenomenon that lies at the crossroads of family, business,
and society. For academics, the exploration of philanthropy
can provide understanding about alternative
vehicles that can help in the preparation of future generations,
in the creation and transmission of legacy
between generations, and in the relationship between
family members. For practitioners, a better understanding
of philanthropy can help when assisting entrepreneurial
families that are concerned about their legacy,
the education of future generations, and creating spaces
for the family to work together.
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16 Family Business Review
Appendix
List of Sources Included in the Review
Year Author Academic Practice Family Business
Outside
the
United
States RQ1 CSR RQ2 Theory RQ3 Foundation RQ4
1988 Atkinson and
Galaskiewicz
× × × × ×
1990 Brody and
Strauch
× × × ×
1990 Danco and
Ward
× × × × ×
1990 Gersick et al. × × × × ×
1990 Hansen × × × × ×
1990 Hayes and
Adams
× × × × ×
1990 Von Lossberg × × × ×
1990 Ylvisaker × × × ×
1993 Prince et al. × × ×
1995 File and Prince × × × × × ×
1998 File and Prince × × × × × ×
2000 Litz and
Stewart
× × × × ×
2004 Hersch × × × × ×
2004 Uhlaner et al. × × × × × ×
2005 Déniz and
Suárez
× × × × × × ×
2006 Dyer and
Whetten
× × × × × ×
2006 Gersick × × × ×
2006 Madden et al. × × × × × ×
2006 Robinson × × × ×
2007 Gallo × × ×
2008 Gray × × × ×
2008 Niehm et al. × × × × × × ×
2008 Ottinger × × × × ×
2008 Pharoah × × × × × × ×
2008 Schwass and
Lief
× × × × ×
2008 Snowdon-
Blanchard
× × × × ×
2008 Zellweger and
Nason
× × × × × ×
2009 Breeze × × × × × × ×
2009 Bronfman × × × ×
2009 Chenier × × ×
(continued)
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Feliu and Botero 17
Year Author Academic Practice Family Business
Outside
the
United
States RQ1 CSR RQ2 Theory RQ3 Foundation RQ4
2009 Ward × × ×
2011 Bingham et al. × × × × × × ×
2010 Credit Suisse × × × × ×
2010 Fitzgerald
et al.
× × × × × × ×
2010 Rey-Garcia
and Puig-
Raposo
× × × × × × ×
2011 Eichenberger
and Johnson
× × × ×
2011 Harvey et al. × × × × ×
2011 Lerner × × × × × ×
2011 Moody et al. × × × ×
2011 Pharoah et al. × × × × × × ×
2012 Fernando and
Almeida
× × × × × × × ×
2012 Kranenburg
and Zoet-
Wissink
× × × × × ×
2012 Lähdesmäki
and Takala
× × × × × × × ×
2012 Lungeanu and
Ward
× × × × ×
2012 Rey-Garcia × × × × × × × ×
2012 Winer × × × × ×
2012 Zhang et al. × × × × × ×
2013 Eichenberger
and Johnson
× × × ×
2013 Rey-Garcia
and Puig-
Raposo
× × × × × × ×
2013 U.S. Trust × × × × ×
2014 Campopiano
et al.
× × × × × ×
2014 Cruz et al. × × × × × × ×
2014 Dou et al. × × × × × × ×
2015 Du × × × × × ×
2014 Hoy and
Rosplock
× × × × × ×
Total 28 27 31 30 18 33 16 50 13 27 18 8
Note. CSR = corporate social responsibility. “×” Indicates that a publication was coded under the characteristics described in the header. The
four research questions explored were RQ1: How is philanthropy conceptualized? RQ2: What are the motivations for philanthropy? RQ3:
How is philanthropy practiced? RQ4: What are the outcomes associated with philanthropy?
Appendix (continued)
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18 Family Business Review
Acknowledgments
The authors wish to acknowledge the valuable comments and
suggestions from Dr. Kelin Gersick, Dr. Tom Lumpkin, and
the anonymous reviewers to make this article better. They also
wish to thank Dr. Ivan Lansberg for his comments on a preliminary
version of this study.
Declaration of Conflicting Interests
The author(s) declared no potential conflicts of interest with
respect to the research, authorship, and/or publication of this
article.
Funding
The author(s) disclosed receipt of the following financial support
for the research, authorship, and/or publication of this article: We
received financial support from the FOBI Scholars Program.
Notes
1. Donations data in U.S. Dollars as of August 17, 2015 are
$67 billion per year in the United States, $1,422.00 million
per year in the United Kingdom, $99.4 million per year in
Italy, and $541.5 million per year in Germany.
2. Although there was 1 book, 1 book chapter, 5 reports, and
48 articles, all of these are referred to as publications.
3. Entrepreneurial families are those that have multiple
businesses that are related to the family system, being
the family the driving force of entrepreneurial behavior
(Michael-Tsabari, Labaki, & Zachary, 2014).
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Feliu and Botero 21
Author Biographies
Neus Feliu is a senior associate at Lansberg Gersick &
Associates, and a PhD candidate in Management Science at
ESADE Business School (Barcelona, Spain). At LGA, she
advises family enterprises, primarily in Europe and North and
South America, on governance and continuity in family companies,
offices, and foundations. Her current research focuses
on social capital and governance issues in family firms and
philanthropy, based on her background in economics and
organizational psychology.
Isabel C. Botero is an assistant professor in the department of
Management at Stetson University and Research Principal at
Fediuk Botero LLC. She obtained her PhD from Michigan
State University. Her research interests include communication
in and about family firms, governance issues in family
firms, and influence processes in organizations.
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