The role of legacy in family businesses

In the study „The Role of Legacy in Family Businesses – An International Empirical Investigation“, published by the WIFU Foundation (2025), Matheus Franco and Thomas Clauß use international data to examine how different forms of legacy influence the sustainable business success of family businesses. The starting point is the observation that legacy – understood as a consciously passed-on legacy comprising values, ownership and family continuity – represents a central, yet hitherto empirically under-explored, guiding principle of family business behaviour.

The study distinguishes between three dimensions of legacy: social, biological and material legacy. Drawing on a sample of over 2,000 family businesses from 71 countries, the authors analyse how each of these dimensions affects economic, social and environmental performance in terms of the triple bottom line. The results clearly show that social legacy in particular – that is, the passing on of values, norms and a sense of purpose – has a consistently positive influence on all three dimensions of success. Biological legacy exerts its influence primarily indirectly through the greater involvement of the next generation, whilst an isolated focus on material legacy is associated with limitations in social and environmental success.

Furthermore, the study identifies six typical types of legacy in family businesses and shows that a balanced combination of social and material legacies provides the best conditions for sustainable business success. The authors derive practical recommendations for action from this and advocate a conscious, reflective engagement with one’s own legacy. Legacy is thus understood not as a nostalgic look back, but as a strategic tool for shaping a business that can be passed on to future generations, one that provides direction, reduces conflicts and enables long-term value creation.