Cracking the Code on Wealth Preservation: It is not about Money: A study of wealth preservation in enterprise families who share ownership of multiple assets and multiple entities across multiple generations

Maarten Bartholomeus Theodorus de Groot

Research output: PhD ThesisPhD-Thesis - Research and graduation internal

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The wealthy are heavily criticized and often at the center of discussion. The public narrative has become deeply polarized in recent years. Research has shown that they derive most of their wealth from active ownership of family enterprises and are different from the stereotypical rich and famous as featured in popular lists. In effect, enterprise families have a major impact on our society: They contribute significantly to global economic growth, employment, philanthropic capital, start-up finance, technological innovation, and even to the performance of capital markets. Moreover, those families with a transgenerational orientation are likely to contribute even more to society and the economy. Given the public debate and the importance of such families to the economy, it seems counterintuitive that in the field of family business research, where the family is the crucial variable theoretically distinguishing family businesses from other firms, the literature has so far neglected the family itself as a unit of analysis and has focused overwhelmingly on the business system. In my dissertation, I set out to study wealth preservation in enterprise families that share ownership of multiple assets (e.g., investments, real estate) and multiple entities (e.g., family business, family office and/or family philanthropic foundations) across multiple generations. I explore why so many fail to secure monetary prosperity for multiple generations. Many enterprise families have the objective of sustaining themselves into the future for multiple generations. They have to navigate challenges and embrace change while responding to environments full of volatility, uncertainty, complexity and ambiguity. While some multigenerational families show wealth preservation success, most others have been much less successful. This dissertation explores how enterprise families can preserve wealth for multiple generations by shifting the analysis from the family business to the family itself. I first conducted a conceptual theoretical study in Chapter 2, from which three concepts emerged clearly: Family governance (how families make decisions together); family social capital (relationships and cohesion); and the nascently researched family office (entity with the goal to preserve wealth). I subsequently opened a theoretical black box by conducting a qualitative exploratory study to zoom in on the origins of family social capital (Chapter 3). My multi-case study focused on seven enterprise family cousin consortiums. I developed four propositions that introduce explanations how enterprise family cousin consortiums enhance social capital to preserve family wealth. Next, I tested my findings with a quantitative empirical study in Chapter 4. The inductive part of this dissertation explains how family governance can be conducive, other than as a structure for policies and procedures, by contributing to family social capital as well as being a formal decision-making and problem-solving mechanism. In the deductive part of this dissertation I propose and test a moderated mediation framework that considers both the how and the when-question and I analyze the contingency role of generational ownership and business ownership to qualify the indirect effects of family learning and family identity in the relationship of family governance practices on family social capital. Findings are based on interviews, surveys, observations and contextual data of enterprise families, many with legacies going back more than 100 years - families with up to 1,000 members and assets worth billions of dollars. The practical relevance of the findings includes understanding that collective family action to preserve wealth is reinforced by effective governance, strong social capital and a family office emphasis on non- financial services. The key driver of family wealth preservation is relational, as opposed to being purely financial, and this research posits that wealth preservation is not about money.
Original languageEnglish
Awarding Institution
  • Vrije Universiteit Amsterdam
  • Elfring, T, Supervisor
  • Mihalache, RO, Co-supervisor
Award date12 Mar 2021
Place of PublicationAmsterdam
Print ISBNs9789036106405234
Publication statusPublished - 12 Mar 2021


  • Business Ownership
  • Enterprise Families
  • Family Governance
  • Family Identity
  • Family Learning
  • Family Office
  • Family Social Capital
  • Wealth Preservation


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