Reciprocal nepotism and sustainable succession in family businesses

Békésiné Kovács Noémi (2026) Reciprocal nepotism and sustainable succession in family businesses. In: Clocks Can Be Stopped, Tipping Points Cannot. Budapesti Gazdaságtudományi Egyetem, Budapest, Magyarország, pp. 1-9. ISBN 978-615-6886-34-7

[thumbnail of IX BGE Inter Sust Stud Conf_proc_20260710_1.pdf]

Szöveg
IX BGE Inter Sust Stud Conf_proc_20260710_1.pdf - Megjelent verzió
Download (385kB)

Abstract

This study explores the relationship between reciprocal nepotism and socioemotional wealth in family businesses with particular attention to leadership succession as a catalyst for organisational transformation within a broader sustainability context. Reciprocal nepotism – defined as competence- and trust-based appointments of family members – is analysed through the FIBER framework (Family control, Identification, Binding social ties, Emotional attachment, and Renewal of family bonds), and it is also considered how social thresholds, such as perceived fairness, legitimacy and inclusion, shape stakeholder responses during succession. Adopting a qualitative, interpretivist approach, the research investigates three Hungarian family businesses undergoing intergenerational CEO transitions. Data were collected through semi-structured interviews with predecessors, successors and non-family employees. The findings reveal that succession is not merely a transfer of authority but a complex, socially embedded process of change that requires balancing among tradition, adaptation and emerging sustainability trends. Management and employee reactions highlight varying levels of commitment, learning and resilience, while also exposing tensions related to equity, role legitimacy and organisational continuity. The study demonstrates that when reciprocal nepotism is embedded in transparent, inclusive and competence-based decision-making, it can support socially sustainable transformation by reinforcing trust, strengthening organisational identity, and maintaining critical social thresholds. Furthermore, the research identifies resilient practices and solutions – such as inclusive communication, stakeholder engagement and structured change management – that enhance both socioemotional wealth and long-term adaptability. These practices help emerging sustainability trends with emphasising social responsibility, intergenerational continuity, and ethical governance in family firms. Overall, the findings contribute to the discourse on sustainable entrepreneurship and ethical succession in FBs by illustrating how family influence can be balanced with professional governance to foster resilience, inclusivity and enduring organisational value.