Prior research on small private firms suggests that founders’exhibiting a bias towards other family members entering the business,results in suboptimal investments and lower profitability (Singell (1997)).Gomez-Mejia et al. (2001) extend this argument and suggest that family CEOs are potentially less accountable to shareholders and directors than outside, professional managers. Schulze et al. (1999) note that placing family members as CEO can lead to resentment on the part of senior nonfamily executives because tenure, merit, and talent are not necessarily requisite skills for top management positions.