Background
Saudi Arabia has endured and continues to face tremendous social and economic transformations that are difficult to comprehend for individuals who are not Saudis or have not lived in the country for a long time. Family-owned companies (FOBs) in Saudi Arabia, which are predominantly focused on elder entrepreneurship, play a critical part in the Kingdoms growing economy (Munagapati, 208). However, there is a scarcity of literature and information devoted to detailing their histories and accomplishments in this transformation process. Whether in industrialized or developing countries, family businesses play an important role in world economic progress. Although many researchers have assessed FOBs economic contributions and social responsibility, the information regarding their evolution and prevalence is scarce. This necessitates a thorough evaluation of internal and external factors that support or hinder their success.
Literature review
The prevalence of FOBs in Saudi Arabia
Samara (202) looked into the factors influenc
ing the increase in family enterprises in Saudi Arabia, focusing on socio-cultural factors. Their findings show that patriarchy and communitarianism are prevalent cultural traits that have led to a sustained dedication to the family firms workforce, prioritization of family harmony over all other goals, and informal human resources (Samara, 202). On the same note, Alhebri (202) found that the existence of heightened uncertainty has allowed the creation of informal governance arrangements and prompted controlling owners to pursue conservative financial policies. Depending on the legal structure of the company, the stage of generational control, and the dynamics of family relationships, these activities result in a variety of economic and societal effects. Munagapati (208) also realized that family relationships, social capital, and human resources are some of the factors contributing to the high prevalence of FOBs in Saudi Arabia. Evidently, as FOBs increase, they pose significant effects on society.
Impacts on society and vice versa