WHEN THE TORCH IS PASSED: HOW INTERGENERATIONAL SUCCESSION RESHAPES ESG PERFORMANCE IN FAMILY FIRMS

Intergenerational succession reshapes authority and strategic priorities within family firms, yet its implications for ESG performance remain insufficiently understood. Drawing on panel data from 1,513 Chinese listed family firms over 2013–2023 and a multi-period difference-in-differences design with heterogeneity-robust estimation, this study finds that succession is associated with a significant decline in ESG performance, an effect consistent with a channel operating through a contraction in management’s long-term focus. Analyst coverage and institutional ownership each weaken this negative association, and the effect is more pronounced during co-governance periods and among smaller firms, offering insights for family business governance and sustainable development policy.