*Hypotheses*

With respect to the mixed empirical evidence from prior research, one can clearly argue that financial and capital structure choices by family businesses are motivated by the level of risk assumed. Anderson and Reeb (2003) argue that "the principal-agent cost and the asymmetric information between shareholders and managers" is reduced when a structure of family firm is adopted in a company. They suggest however that the risk averse nature of the controlling families is disintegrated through monitoring. DeAngelo and DeAngelo (2000) add that the risk aversion of family companies is achieved through avoiding high risk projects even when they have positive net present value as large and undiversified shareholders might impose costs to well-diversified shareholders with minority power. Thus, our first hypothesis:
