Summary

To advance our understanding of the effect of social capital on entrepreneurial behaviour in family businesses, this study investigates trust, as a relational form of social capital, and its role in the entrepreneurial processes of intergenerational family SMEs in China. The study adopts a qualitative case-study approach, with data from fieldwork interviews, observations, and secondary sources analysed by using interpretative methods. It is revealed that multiple types of trust exist concurrently in Chinese family SMEs. However, it is the interpersonal trust on the basis of goodwill and competence that prevails, with contractual trust remaining weak and marginal. Three patterns of trusting relationships are identified, each of which has both positive and negative effects on entrepreneurship and innovation in family businesses.  There is also a potential “dark side” of trust, which incurs extra cost and commitment to family SMEs in their entrepreneurial processes. Family business owner-managers are suggested to avoid relying on a single type of trust. It is necessary that they make sense of the trust they place in certain actors in their business and social networks before assigning resources to specific business activities to minimise the chance of incurring social costs to the entrepreneurial processes.

About the Presenter

Dr Henry Shi is a Senior Lecturer in Family Business and Entrepreneurship at the University of Adelaide. He received his PhD in Management from the University of Auckland, Master of International Business from the University of Melbourne, Advanced Certificate in Teaching from the University of British Columbia, and Bachelor of Arts from Nanjing University of Aeronautics and Astronautics where he also currently holds a visiting professorship.

Henry’s research contributes to the understanding of SMEs, particularly those owned and managed by families or family groups across generations. His research often takes an exploratory approach and investigates distinctive patterns in which private entrepreneurship sustains over time, and the effects of the evolving socio-economic contexts on SME strategy, ethics, entrepreneurship, innovation, and internationalisation. Both theoretical and empirical contributions are made to a wide range of organisation and management literature.

Henry is the author of Entrepreneurship in Family Business (Springer, 2014), and an editorial member of International Journal of Management Practice, as well as academic reviewer for multiple journals. His recent work has been published in International Journal of Entrepreneurial Behaviour and Research, Journal of Business Ethics, Journal of Small Business Management, Long Range Planning, among others.

Contact Information

Should you have any enquiries, Please feel free to contact: cebp@hksyu.edu