Socioemotional Wealth and Leadership Transitions in Indonesian Family Businesses

Abstract

This article examines the issue of succession in family-owned businesses in Indonesia, using a qualitative approach to explore the role of socioemotional wealth in the intergenerational transfer of ownership. Socioemotional wealth can shape succession outcomes in both positive and negative ways, influencing not only the continuity of the business but also the engagement of the next generation. The study surveyed 50 small and 30 medium-sized enterprises operating within the informal economy. The findings highlight several possible succession scenarios, shaped by factors such as the pace of economic development, the heirs’ motivation to take over the business and their educational background.