The impact of culture-related factors on good governance in Greek family businesses in South Africa

Abstract

The size of the family business component of the South African economy suggests that it is the predominant way of doing business in South Africa. A large proportion of these family businesses are Greek-owned. More importantly it is estimated that approximately 95% of all Greek businesses in South Africa can be classified as family businesses. The sustainability of Greek family businesses requires that they maintain good governance practices that are both economically and environmentally acceptable to all stakeholders. It also requires that the next generation of Greek entrepreneurs effectively balance good governance of their businesses with their family commitments. The primary objective of this study was to identify and explore the internal, culturally-related factors that influence good governance to ensure the survival, growth and sustainability of Greek family businesses in South Africa. A theoretical model of good governance factors was proposed and tested using Structural Equation Modelling. The study found that perceived good governance in a South African Greek family business context needs to be managed in terms of three factors, namely risk control, the internal regulatory environment and the protection of the stakeholders? interest. The study found that needs alignment, cultural needs alignment, vision and ethnic entrepreneurial growth all impact directly or indirectly on perceived good governance in South African Greek family businesses.