It is a common practice in Thailand for businesses to be closely tied to extensive families and this link is established through marriages, which are considered to be the most trustworthy form of family connections. Thus, family members, typically, are involved in firm management by serving on the board of directors or as CEOs in Thai family firms rather than hiring external professional managers (Wiwattanakantang 2001; Bunkanwanicha et al. 2013). For instance, about 96.40% of family firms listed on the Stock Exchange of Thailand (SET) have members working on the board of directors or management team in 2015. These imply that families can exert power over listed companies, and it is difficult for the board of directors to be independent.
References
Bunkanwanicha, P., Fan, J.P., Wiwattanakantang, Y., 2013. The value of marriage to family firms. Journal of Financial and Quantitative Analysis 48, 611-636
Swanpitak, T., Pan, X., Suardi, S., 2020a. Family control and cost of debt: Evidence from Thailand. Pacific-Basin Finance Journal, 101376.
