*4.2. Correlation Matrix*

Table 5 reports the results of the correlation between variables. The correlation coefficient between variables shows no multicollinearity problem except for BO\_MEET with BO\_SIZE (0.776), and GOV with FOR (0.761). While perfect multicollinearity is considered a serious problem, often signaling a logical error, imperfect multicollinearity (correlation coefficient nearly equals 1) may not be an error but just a feature or characteristic of data. Therefore, we do not drop these two variables for running the final regression.


**Table 5.** Correlation matrix.

#### *4.3. Regression Results*

#### 4.3.1. Family Ownership and Firm Performance

Table 6 reports the results of the fixed effect regression model for all firms, family firms, and non-family firms separately. In the case of all firms, Table 6 reveals that family ownership has a positive effect on Tobin's Q at the 5% significance level. However, it shows a negative relationship with ROA. For family firms, family ownership tends to have a positive impact on Tobin's Q, which is consistent with previous literature (Saito 2008, for Japan; Isakov and Weisskopf 2014, for Switzerland; Muttakin et al. 2015, for Bangladesh). However, we found that family ownership hurts ROA. Plausibly, this happens because family firms do not heavily focus on short-term profitability, which is reflected by ROA (Kapopoulos and Lazaretou 2007), to please third-party shareholders. Instead, they strive for long-term and sustainable growth, as opposed to non-family firms, to pass their wealth to future generations. It is worth noting that ROA and Tobin's Q are different measures of firm performance. ROA is an accounting-based measure reflecting short-term performance, while Tobin's Q is a market-based measure focusing on long-term growth. Thus, we may not always have consistent estimates. As for non-family firms, family ownership concentration does not exist, so no relationship is recorded. As a whole, we conclude that a significant positive connection runs between family ownership and firm performance, measured by Tobin's Q (H1). For ROA, the hypothesis H1is rejected.


**Table 6.** Fixed effect regression result.

Note: \*\*\* meaning *p*-value is less than 0.001; \*\* meaning *p*-value is less than 0.01; \* meaning *p*-value is less than 0.05.
