Family ownership and control may lead to the selection of less-qualified managers.

Question

Quizplus · Accepted Answer

When family ownership and control are present, there may be a tendency to prioritize family loyalty over qualifications, leading to the selection of less-qualified managers. This is known as "nepotism," and it can be detrimental to the success of a company. However, it is not a universal truth, as family businesses may also prioritize merit-based selection and actively seek out qualified individuals for managerial roles.

Family Ownership and Control May Lead to the Selection of Less-Qualified