Understanding the Role of Family-Controlled Investment Companies in Sustainable Development: A Study on Swedish Corporations listed on the OMX Stockholm Large Cap

Abstract: Background: Research has shown the need for a transition into business models incorporating environmental, social and governance in their organizations to achieve sustainable development. Family-controlled and owned investment corporations have the potential to use their leverage and influence to encourage sustainable development.  Purpose: The aim of this study is to enhance the understanding of how family-controlled and owned investment corporations take into consideration sustainability conducting acquisitions and govern their holding companies.  Method: The study employs a deductive research approach with a qualitative method, containing three semi-structured interviews. The three respondents are representing three Swedish family-controlled and owned investment corporations listed on the OMX Stockholm Large Cap.  Conclusion: The findings highlight that family-controlled and owned investment corporations incorporate sustainability in potential investment decisions, and among their holdings, which is supported by ownership and control. By reason of sustainability, behavioural governance aligning with stakeholders’ interest is essential. A long-term perspective facilitates development of sustainability, and it stands to benefit from stable shareholders. In consideration of societal impact, “megatrends” guides acquisitions. Identifying risks and opportunities are aided through GRI reporting, and long-term sustainability is aided by ESG aspects. However, criticism connected to ESG and GRI are addressed.