**3. Research Methods**

## *3.1. Definition of Family Firms*

We classified a company as a family firm if it satisfied any of the five criteria: (a) run by a founder; (b) run by family members who hold important positions inside the company (such as Chairman, Vice Chairman, Chief Executive Officer); (c) controlled by family members who are on the top 10 shareholder list; (d) controlled by family members who account for 50% of the number of board members; and (e) owned by a privately held company. We adopted these criteria following previous studies on Japanese family firms (Yoshikawa and Rasheed 2010; Saito 2008; Morikawa 2013; Arikawa et al. 2017; Hideaki et al. 2018).
