Although the study of non-economic objectives is particularly prominent in family business research, non-family firms set and pursue similar goals. Extant literature also explains why family firms pursue non-economic goals; however, less is understood regarding the ways in which family ownership impacts the outcomes associated with such objectives. Grounded in the ongoing study of family business strategy, this article explores two sets of noneconomic goals – family and community objectives – in SMEs with varying levels of family ownership. Applying goal systems theory to analyze the configurations of goals and means among the SMEs in our sample, we find that family ownership interacts with the presence of non-economic objectives to influence firm performance.

Introduction

The salience of non-economic objectives is an important strategic idiosyncrasy of family firms. Accordingly, non-economic objectives and their impact on firm outcomes are core topics in family business research (Chrisman & Patel, 2012). This research intersects with other discourses on small and medium-sized enterprise (SME) strategy – most notably, social responsibility (Tang, Hull, & Rothenberg, 2012) and social entrepreneurship (Stevens, Moray, & Bruneel, 2015). While noneconomic goals, in general, are not unique to family firms, enterprises typically classified as family businesses tend to pursue objectives specifically benefiting the owning family (Chrisman, Chua, Pearson, & Barnett, 2012). Often, the desire to maximize and preserve the socioemotional wealth (SEW) – the affective endowments derived from firm ownership that benefit the owning family (Gómez-Mejía, Haynes, Núñez-Nickel, Jacobson, & Moyano-Fuentes, 2007) – is conceptualized as a catalyst for many practices, behaviors, and strategies in family firms. The tendency in extant research to use family ownership as a proxy for non-economic family objectives obscures the complex interdependencies between ownership and various organizational goals, including, but not limited to those serving the family.