CHAPTER 1- INTRODUCTION
Over the past year, the growth of family businesses in Belize has been exponential. These businesses are from various sectors of the economy such as tourism, professional businesses services, sales and distribution, medical and to a lesser extent manufacturing. Regardless of the size, complexity or type of business, socio emotional wealth (SEW) management is a dominant paradigm in the family business field. SEW also helps to differentiate family firms as a unique entity and it provides an understanding as to why family firms operate differently.
1.2 Background of problem
Indeed, Socio Economic wealth management in family business is a complex but interesting phenomenon that has barely been addressed. This concept has rapidly being seen as an issue to consider both locally and internationally. According to Gomez-Mejia et al. (2007) a family-owned business (olive oil mills) refused to join cooperatives and decided to remain independent although cooperatives would yield many financial benefits. They were instances where family owned businesses chose to appoint ‘affiliate directors to the board’, although it would prevent the board from monitoring management and receiving independent advice (Jones, Makri, and Gomez, 2008). In fact, favourable contracts (welfare, health, and agency) would be offered to top level management when the team is comprised of family members. In light of these examples and the vast array that exist, it is evident that Socio Emotional Wealth management is becoming an area of great interest. The following sections of this study seeks to discuss the dimensions of SEW and develop a deeper understanding of its prevalence in family Business in Belize.
1.3 Definitions of Unit of Analysis
socio emotional wealth
1.3.1 Wealth management- Need a definition from diva portal or Google scholar (with citations)
Wealth management is an investment-advisory discipline which incorporates financial planning, investment portfolio management and a number of aggregated financial services offered by a complex mix of asset managers, financial planners, commercial banks and others.
1.3.2 Family business- Need a definition from diva portal or Google scholar (with citations)
A family business is a profit making entity in which decision-making is influenced by family members related by blood or marriage or adoption and whereas they have both the ability to influence the vision of the business and the willingness to use this ability to pursue distinctive goals.
1.3.3 Socioemotional- Need a definition from diva portal or Google scholar (with citations)
Socioemotional development is defined as a psychological theory that human personality is developed through a repeating series of crises and resolution.
1.4 Definition of Business and Theoretical Construct
“Socioemotional Wealth: is a model that introduces the aspect that family firms are usually driven by non-financial aspects, even when handling and reasoning regarding financial decision making” (Berrone et al.,2012)
FIBER: – I don’t think this should be like this – instead it should be like a paragraph with citation
Family control and influence
Identification with the Firm
Binding social ties
Renewal of family bonds to the firm through dynastic succession
Crowd funding- the umbrella term for different ways of raising fund from “the crowd”. There are four main types –donation based, reward based, crowd lending and crowd equity (Mollick, 2013).
1.5 Description of landscape (country, city etc.)
Belize, located on the eastern coast of Central America, has a small, mostly private enterprise economy that is based primarily on tourism, agriculture, agro-based industry, sales and distribution, construction and minimal exportation of crude oil. According to the Belize Chamber of Commerce and ; Industry (BCCI), they are approximately 300 Belizean businesses. The government of Belize is fully supportive of the country’s niche-oriented development by offering fiscal incentives to businesses that qualify under the fiscal incentive act and to business that demonstrate the capacity and ability to provide economic and social growth to the country.
1.6 Significance of Research (WHY)
1.6.1 Requirements of the course
This thesis project is a requirement to complete the bachelor program at the University of Belize. According to the course outline, ” It involves formula problem statement, identifying research questions, conducting and writing a literature review, choosing a sample, selecting an appropriate research design, quantitative and qualitative data collection, quantitative and qualitative data analysis and interpretation, writing the research report, and ethical and legal issues related to social science research”. Overall, the researcher will be conducting this study to successful complete the course and receive a bachelor’s degree from the University of Belize.
1.6.2 Personal interest
Wealth management within family businesses is an interesting topic which to my knowledge not much researched has been published. During my personal and professional development I have seen several family businesses fail after the parents (figure heads) retire or are deceased and whereas the children are unable to maintain the business operational and successful. On the other hand, there are exemplary families who make sure that the family business continues by preparing the heirs through sound education, managerial and operational involvement.
As owner of several business, it’s my interest to ensure that there is continuity even if my children are not actively involved (since they may choose careers other than business advisory, accounting, sales and e-commerce).
1.6.3 Reflection of Literature
– general socio emotional wealth
– In family business
– In Belize and the Caribbean
1.7 Research Purpose (Thesis Statement)
The purpose of this research is to understand the prevalence of socio economic wealth management of family business in various sectors in Belize. The sectors will include Professional Services, E-commerce, Imports, Entertainment, Tourism and Medical services. In order for the purpose to be achieved, the following must be carried out;
o Identify the level of family control and influence
o Understand the extent of binding social bonds at the firm/company
o Investigate the presence of emotional attachment of family members
o Understand the succession plan of the firm/company
1.8 Research questions
1.9 Summary of Chapters structure
The thesis is divided into several chapters:
Chapter 2 reviews previous research on Socioemotional Wealth Management and the theoretical frameworks related to the research are discussed.
Chapter 3 discusses the methodology used for this thesis, as well as the different techniques chosen, based on the Research Onion (Saunders, 2009).
Chapter 4 presents that data analysis and the findings based on the different theories
Chapter 5 is the conclusion to the research and provides recommendations.