The Governance Effect of Different CEO Successors’ Status in Family Firm

At present, our country is in a special period of economic transition and social transformation, where many companies are accelerating the transformation into digital organizational forms. Family businesses are becoming increasingly cautious in their selection of successors for the next generation. Due to the clear identity differences between family CEOs and non-family CEOs in family businesses, attitudes towards the two groups may also differ, leading to bifurcation bias. This paper takes Chinese family businesses as samples and analyzes the impact of identity differences between family successor CEOs and non-family CEOs on corporate governance effects from Bifurcation bias and social emotional wealth theory. The study finds that for most Chinese family businesses, sticking to family management will be a better choice, which can greatly reduce the risks of succession. Family businesses also need to consider the issue of corporate succession as early as possible and select suitable successors for training, so that the power transition can occur as soon as possible.