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While leaders in both family-owned and publicly-held companies have, at times, practiced nepotism, the different contexts may produce different long-term results. Many publicly held companies have anti-nepotism policies ranging from prohibiting the employment of any relatives to prohibiting the supervision of a spouse. Nepotism policies originated from two principal sources: (1) depression in the 1930's, during which so few jobs were available it was considered unfair for one family to hold two jobs: and (2) a general effort to prevent favoritism toward incompetent male relatives during the mid 1950's, Newgren, K.E et al (1988 ).

Such nepotism polices are not normally found in family-operated businesses where the practice is commonplace, Nelton, S (1998, 05).If there is any doubt in the decision between a family and a non-family member, one would suspect that the job offer would be going to the next-of-kin, Bellow A (2003).

The purpose of this research paper is to determine from the literature reviews if there are merits to claims that nepotism can be beneficial to family-operated business while in the caseof publicly held companies the results are most likely to be the opposite.

Nepotism is known to be practiced in both family-operated and publicly held companies. However, both normally do not garner equivalent results in the long run. Business practices and policies of many publicly held companies have adapted nepotism policies which helped to curb much of these practices, Newgren, K. E et al (1988 ). However, such policies are uncommon in family-operated businesses where it is believed that if done with fairness, adds value to the organization. Thus, nepotism is encouraged in some family-operated businesses because they believe that it resulted in high performance, stability and long-term commitment by company employees.

Opponents of nepotism have claimed that the rise of an intellectual, analytical approach to management spells the decline and ultimate extinction of nepotism. However, nepotism is alive and on the march in US business and will continue to remain deeply ingrained in all industries simply because it pays to be related to the boss,Wong, L.C et al (1994. According to experts, most of the trouble arises when the imperatives of the 2 very different institutions - family and business - come into conflict, Nelton, S (1998, 05).

Nepotism can needlessly expose an organization to family fights and sibling rivalries (e.g. the Getty family power struggle between brothers). Nepotism can cause a company to lose valued executives and to be unable to attract new ones. When a family member rises to the top, it can discourage the non-family managers and lessen their commitment and dedication to the firm. The family-dominated operations would also discourage ambitious professional managers from joining the company. Even though a son or daughter shines in certain fields, he or she may not offer the right mix of talents that a company needs at a crucial moment in its history. If management stagnates, so does corporate performance,Wong, L. C et al ( 1994 )

Due to the lack of current empirical research on nepotism in businesses, this motivates me to seek answers to the question, "how does family-operated business differs from publicly held companies and extent of those differences?".

Although the practice of nepotism is not prohibited by law, it does raises ethical questions for family-operated business, since the practice could expose them to legal actions if it is determined they have violated anti-discrimination laws, even if it occurs inadvertently, Sjoberg A. R et al (2017). In some publicly held companies, nepotism policies typically range from prohibiting the employment of any relatives to prohibiting the supervision of a spouse. Nepotism policies originated from two principal sources: (1) depression in the 1930's, during which so few jobs were available it was considered unfair for one family to hold two jobs: and (2) a general effort to prevent favoritism toward incompetent male relatives during the mid 1950's, Newgren, K.E et al (1988 ).

According to Wong, L.C et al (1994, nepotism might be quite valuable in family run business given that family-operated businesses are not constraint by nepotism policies as practice in publicly held companies. And given that about 35% of the fortune 500 companies are family operated business, any violation of workplace discrimination could have far reaching impact on such an organization. Therefore, because publicly held companies are more likely to have policies in place to prevent or curtail the practice of nepotism, they would be less likely to be inadvertently be exposed to unethical practice such as discrimination that could exposed the company to legal actions.

With respect to this paper, the questions are based purely on the available data, simply because the research on nepotism in company-operated business are not that current. It is not yet known for sure if sufficient evidence exists to suggest to what extent the practices of nepotism in family-operated business differ from publicly held companies. Several literatures from the reviews have highlighted the various methods used to described both business practices (family vs publicly held companies), but they all have not agreed on any one method or model, although suggestions have been made that agreed upon policies in the hiring process of family members are encouraged, provided it is done with fairness, Aronoff, C. E et al (1988) This paper will attempt to help bridge the gap between what is currently known about the practice of nepotism in family-operated business vs publicly traded companies and the extent of the differences.

Literature review.

Nepotism is known to be practiced in both family operated and publicly held companies. However they don't normally garner the same kind of results in the long run. Business practices and policies of many publicly held companies have adapted nepotism policies which helped to curb much of these practices, Newgren, K.E et al (1988 ). However, such policies are not normally found in family operated businesses where the practice of nepotism seems to thrive and or encouraged, Nelton, S (1998, 05).

Margaret Y, et al (2005) sees nepotism as the practice of showing favoritism during the hiring process toward relatives or spouses of current employees in an organization.

Perhaps the most common form of nepotism occurs in family-operated businesses when the children or relatives of the owners are hired. And while some degree of nepotism may be expected in family-owned businesses, this does not necessarily mean that it is considered acceptable or desirable. In fact, in the case of hiring, evidence suggests that many people are opposed to nepotism or any other hiring practice that involves showing preference based on some factor other than merit, Padett, M. Y et al (2015).

In publicly held companies, results showed that successful performance of nepotism beneficiaries was attributed more to political skills and relationships with upper management and less to ability and effort. These negative perceptions occurred regardless of the family member's qualifications, Padett, M. Y et al (2015).

Padett, M.Y et al (2015) suggested that two different perspectives emerge regarding the desirability of practicing nepotism in the hiring process. The first perspective, and the perspective that seems to be the most frequently espoused, is that nepotism is undesirable and should be avoided. The presumption from this perspective is that most people are opposed to the practice of nepotism and that primarily negative consequences will result for organizations that practice it. The alternative perspective on nepotism is less widely expressed or endorsed. According to this perspective, people do not necessarily have a negative attitude toward nepotism and may, under certain circumstances, have a positive attitude. Paddett, M. Y et al (2015) stated that implicit in this perspective is a distinction between ''good'' and ''bad'' nepotism. ''Bad'' nepotism occurs when family members are favored in the hiring process even when they are not qualified while ''good'' nepotism involves giving preference to family members but only when they are qualified. According to this perspective, people have negative attitudes toward ''bad'' nepotism but not toward ''good'' nepotism.

Extending this perspective further, some have argued that nepotism can be beneficial for organizations and that it should be encouraged as long as it is practiced in conjunction with principles of merit. Most family-operated businesses do not survive beyond the founder and the first generation. The successful ones typically require family members to earn advanced degrees in business or other related fields or spend at least five years working for a competitor.

Brown-Forman, distillers of Jack Daniels and Southern Comfort, ascribe their success over six generations to a policy of "planned nepotism." Asplundh Tree Expert Co. puts family members through a rigorous apprenticeship program designed to discourage dilettantes, Bellow, A (2003).

Studies have suggested that giving preference in the hiring process to family members may have some unanticipated negative consequences for those who benefit from it and, indirectly, for the organization. These findings indicate a need to better understand the practice of nepotism so that family-operated business and other organizations who might want to reap some of the potential benefits of hiring family members can be aware of both the positive and negative consequences associated with this practice and can manage the process effectively, Padett, M. Y et al (2015).

Paddett, M. Y et al (2015) suggested that not all instances of nepotistic hiring are likely to be perceived as equally unfair. The extent to which the qualifications of the family member are considered during the hiring process may influence the perceived fairness of nepotistic hiring. And that nepotism is not perceived negatively or as unfair when preference is given to qualified family members.

Summary of Annotated Bibliography

In summary the overwhelming outcomes of the article review seem to highlight issues associated with the role nepotism plays in the hiring process of family or family-related members. The article focused quiet extensively on whether merit and fairness were taken into consideration in the hiring and promoting process. What the article search has shown is there were several views expressed on merit, fairness, values, leadership and performance as conditions for acceptance of "good' nepotism in opposed to 'bad" nepotism.

Conclusion of Annotated Bibliography

In conclusion, the article review seeks to determine ifthere are merits to claims that nepotism can be beneficial to family-operated business as opposed to publicly held companies.