“Family Dynamics and Business Performance in Palestinian Industrial Family Businesses: The Moderating Role of Corporate Governance” رسالة دكتوراة

Abstract

Background: Family businesses dominate the Palestinian economy, comprising over 70% of West Bank enterprises and significantly contributing to GDP and employment. Operating in a volatile socio-political environment with restricted mobility, legal uncertainties, and economic disruptions, these firms face challenges in sustaining performance. This study investigates how family dynamic family control, identification with the firm, social ties, emotional attachment, and dynastic succession, impact business performance, measured by financial and non-financial indicators. Methodology: Employing a quantitative cross-sectional design, data were collected from 382 West Bank family business leaders via structured questionnaires targeting industrial firms. The questionnaires assessed family dynamics, corporate governance, and business performance. PLS-SEM analyzed relationships, with reliability and validity ensured through Cronbach’s alpha and component analysis. Result: Results confirm that family dynamics significantly enhance business performance. Corporate governance positively impacts performance and moderates the family dynamics-performance relationship, strengthening outcomes with effective mechanisms. Family dynamics also improves governance quality. Practical Implications: Palestinian family firms should formalize governance through advisory boards and succession plans to leverage family strengths and reduce conflicts. Policymakers should promote culturally aligned governance training and hybrid models. Practitioners must balance emotional commitment with professional management to ensure sustainability and generational continuity.