Family and medium-sized enterprises (family SMEs) have distinct characteristics from both large family businesses and non-family SMEs. They are characterized by governance dominated by the family, strong emotional involvement, intergenerational transmission logic, and often more informal and conservative decision-making modes. In these organizations, the coexistence of family logic and entrepreneurial logic generates unique complexity. Family SME leaders must simultaneously pursue classical economic objectives and socio-emotional objectives linked to the owning family. Socioemotional wealth—meaning the family's affective attachment to the enterprise and willingness to preserve family heritage—strongly influences strategic decisions. Consequently, these enterprises display longer-term vision, increased aversion to losing family control, and governance centered on aligning family and organizational interests. Their small size and limited resources reinforce agility and flexibility but limit investment capacity and strategic formalization. Studies show that family SMEs tend to invest less in R&D than other SMEs while innovating more incrementally through improvements driven by family tacit experience. Family SMEs are characterized by a constant paradox between tradition and change, as they value continuity and sustainability of family patrimony while facing imperatives of competitivity and innovation in their environment.
In recent years, these tensions intrinsic to family SMEs are exacerbated by two major and simultaneous societal challenges: digital transformation and sustainable transition (CSR and sustainable development commitment). This 'double transition' is defined as 'the combination of digital technologies and the objectives of the European Green Deal.' This double transition places family SMEs before competing requirements that can be difficult to reconcile. On one hand, digital transformation implies adopting new technologies, digitizing processes and often challenging traditional business models, with high investments and strong uncertainty. On the other, sustainable transition requires integrating environmentally respectful and socially responsible practices, potentially requiring costly trade-offs in the short term for long-term societal benefit. The conjunction of these two transitions poses particular challenges to family SMEs: how to innovate and digitalize without betraying family values, past heritage and identity transmitted between generations? How to invest in clean and digital technologies with limited resources without compromising enterprise sustainability for family successors? These enterprises must navigate between the need for technological efficiency and the desire to remain faithful to an identity, between competitive pressure to modernize and moral commitment to sustainable practices and community.
The structure of family SMEs can both facilitate and hinder this double transformation. Their small size and centralization of power in family hands can confer decision-making agility and rapid adaptation capacity necessary for innovation and rethinking business models. Several family SMEs have successfully transformed their offerings through digital means while strengthening sustainable local anchoring, demonstrating possible alignment between economic, technological and socio-environmental objectives. Recent studies demonstrate that family SMEs, despite limited resources, engage significantly in the economic, social and environmental dimensions of sustainability, notably due to their local anchoring, transgenerational logic and family reputation. The presence of a new generation of leaders familiar with technologies can constitute a powerful lever for accelerating digitalization while raising enterprise awareness of sustainability issues. Generational succession can represent a critical moment for initiating or blocking double transition dynamics, as it often presents an opportunity for rebalancing between traditional values and transformation ambitions. Conversely, family tradition and conservatism of some leaders can slow adoption of overly disruptive changes, whether technological or ecological. Recent research shows that family SMEs often adopt pragmatic and incremental approaches to digital transformation, favoring small adjustments over radical upheaval, and remaining sometimes reactive rather than anticipatory regarding technological evolution. These enterprises may also be tempted to minimize or symbolize their sustainable commitment to protect family image without deeply modifying operations.
This dual observation suggests a paradox of capacity and willingness showing that family SMEs possess assets (local anchoring, strong relational network and transgenerational vision) that could theoretically facilitate joint integration of digital and sustainable elements, but these same factors can generate reluctance toward change, from fear of diluting family identity or exposing the enterprise to poorly controlled risks. This cautious approach leads to reluctance to collaborate with external actors, although studies demonstrate that R&D collaborations significantly improve innovation potential. Social capital is a key factor influencing family SME performance by facilitating access to resources and opportunities. Family SMEs find themselves in an ambivalent position regarding digital transformation insofar as their concentrated governance and reactivity can make them agile actors, but their desire to preserve family control and prudent logics can also render them refractory to profound technological changes. This paradoxical dynamic has been described as a 'Janus-faced' posture, highlighting ambivalence between openness and closure to change.
This special issue proposes analyzing double digital and sustainable transition through the lens of tensions, trade-offs and paradoxes specific to family SMEs. The objective is to understand to what extent the family nature of these SMEs influences their capacity to conduct these two intertwined transformations, and how they manage resulting dilemmas. An approach through organizational paradoxes appears particularly fruitful for studying situations where a priori contradictory objectives must be pursued simultaneously. Family SMEs face the tradition vs innovation paradox: how to integrate breakthrough digital technologies while preserving knowledge inherited from the family? This dilemma takes particular intensity during intergenerational succession phases, where the new generation must both respect the predecessor's history and practices while affirming their own strategic vision, often more open to innovation or digitalization. They also face the socio-emotional vs financial paradox: how to reconcile pursuit of non-economic goals (family cohesion and local reputation) with investments—sometimes significant—required by digitalization and ecological transition? This paradox takes particular form in family SMEs, as they are structurally engaged in delicate balance between economic and family logic, where decisions are influenced by emotional, patrimonial or identity considerations that can conflict with short-term financial imperatives. Finally, they must resolve the local vs global paradox: digitalization opens global markets and new collaborations, while sustainability often reinforces local anchoring and consideration of proximate stakeholders. These paradoxes, if poorly managed, can obstruct double transition by generating family conflicts around strategic orientations. Conversely, if recognized and actively managed, they can become sources of creativity and organizational renewal.
This challenge of family SME double transition holds worldwide importance. While most studies on family enterprises and digitalization or sustainability have concentrated on Europe or North America, family SMEs play a capital role in Latin American, Asian and African economies, where they represent significant portions of entrepreneurial tissue. Varied institutional, cultural and economic contexts of these regions can accentuate certain issues. This special issue welcomes contributions addressing diverse geographic contexts to broaden knowledge beyond sole European and North American frameworks. International comparison can notably illuminate how different environments (regulations, public support, business culture, etc.) influence how family SMEs approach this double challenge of sustainable and digital transformation. Moreover, studying family SME double transition raises major theoretical and managerial questions. From a scientific perspective, it offers opportunity to cross research fields in family enterprise, SME innovation/digitalization and corporate social responsibility to generate new perspectives. Expected added value of this special issue resides in fine understanding of specific trade-offs operated by family SME leaders and strategies they deploy to resolve (or exploit) tensions linked to joint—simultaneous or sequential—conduct of digital and sustainable transformation of their organization. Articles can mobilize varied conceptual frameworks such as paradox theory, resource dependence theory, socio-emotional theory, effectuation theory, etc., to analyze this complex phenomenon. However, expected contributions, whether theoretical, quantitative or qualitative (case studies, ethnographies, comparative analyses…), must all maintain central focus on family SMEs and how their family character orients their trajectory of digital and sustainable transformation.
The expected contributions must highlight contrasting hypotheses or new results on the subject by demonstrating, for example, that under certain conditions, the family character of an SME constitutes a decisive asset for conducting double transition, while in other situations it can represent significant barrier. This effort to clarify conditions of success or failure of double transformation is crucial for advancing both theory (by identifying mechanisms at work) and managerial practice (by providing family leaders benchmarks to orient their strategies).