(2008). 'To provide for the settlement of my affairs': inheritance and ownership in family firms during the transition to limited liability.
In: Fellman, Susanna; Vaara, Eero and Kuusterèa, Antti eds.
Historical Perspectives on Corporate Governance: Reflections on Ownership Participation and Different Modes of Organizing.
Commentationes Scientiarum Socialium (72).
Helsinki, Finland: Finnish Society of Science and Letters, pp. 157–171.
Succession has long been seen as a key issue for family firms. The issue is usually seen in terms of management; yet passing on the firm also involved decisions about the distribution of ownership. In an age before limited liability, considerable risks were attached to business ownership and it was widely accepted in nineteenth-century Britain that it should be closely linked to control. In dividing their estates, therefore, businessmen often distinguished between descendants who were or might become partners and those who were not expected to assume this role. This paper uses wills and shareholding records from one region of Scotland to explore how business owners sought to manage their succession and balance the competing interests of family and firm. It starts by examining the wills of partners in unlimited companies and goes on to consider how the gradual adoption of limited liability between 1880 and 1930 led to changes in practice. It argues that the conventions surrounding inheritance shaped the character of family firms so that these changes had profound implications for the relationship between family and firm.
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