Paper Number
ICIS2025-2797
Paper Type
Complete
Abstract
Digital transformation pressures have prompted firms to signal their digital intent, which we conceptualize as Digital Orientation. This study examines how ownership structures shape such signaling among Indian family firms. Drawing on the Resource-Based View and Signaling Theory, we argue that Family Business Groups (FBGs), buffered by internal capital and reputational assets, exhibit lower Digital Orientation than Standalone Family Firms (SFFs). We further propose that foreign ownership substitutes for digital signaling by providing external legitimacy, with its dampening effect weaker for FBGs than for SFFs. Using panel data from publicly listed family firms (2016–2021) and a novel text analysis of annual report disclosures, we find support for these hypotheses. Our findings position Digital Orientation as a dual-role construct that structurally shapes capability development and symbolically signals modernization, and highlight how ownership heterogeneity conditions digital posturing in emerging markets.
Recommended Citation
Sonpatki, Ria; Kathuria, Abhishek; Karhade, Prasanna; and Ray, Sougata, "Dynasties and Disclosures: The Dual Life of Digital Orientation for Family Firms" (2025). ICIS 2025 Proceedings. 20.
https://aisel.aisnet.org/icis2025/digitstrategy/digitstrategy/20
Dynasties and Disclosures: The Dual Life of Digital Orientation for Family Firms
Digital transformation pressures have prompted firms to signal their digital intent, which we conceptualize as Digital Orientation. This study examines how ownership structures shape such signaling among Indian family firms. Drawing on the Resource-Based View and Signaling Theory, we argue that Family Business Groups (FBGs), buffered by internal capital and reputational assets, exhibit lower Digital Orientation than Standalone Family Firms (SFFs). We further propose that foreign ownership substitutes for digital signaling by providing external legitimacy, with its dampening effect weaker for FBGs than for SFFs. Using panel data from publicly listed family firms (2016–2021) and a novel text analysis of annual report disclosures, we find support for these hypotheses. Our findings position Digital Orientation as a dual-role construct that structurally shapes capability development and symbolically signals modernization, and highlight how ownership heterogeneity conditions digital posturing in emerging markets.
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