Abstract

The structure of Italian manufacturing industry is dominated by the presence of small firms, while large firms have become increasingly less important in recent decades. In the last few years several authors have pointed out the increasing importance of medium-sized firms. Given the difficulties recently experienced by both small and large firms, medium-sized firms are emerging as the possible future backbone of the Italian industrial system. The identification of medium-sized firms is controversial. They are defined by the EU as those firms with more than 49 and less than 250 employees. We claim that for most sectors this is a too narrow definition and that both limits should be significantly increased. The relevance of mediumsized firms is undervalued by official statistics - which use legal entity as the unit of analysis - given that most of these firms are organized as business groups. Moreover, medium-sized firms often control the final stages of production chains and for this reason they influence the investment and production policy of a large number of suppliers. One of the main problems of medium-sized firms is their governance structure. Indeed, although they have a complex organizational structure, they are often characterized by family ownership and control. Only a few of these firms are listed on the stock exchange and the main source of external finance is still through bank loans. After reviewing the recent debate on corporate governance, the article points out some specific features of governance in medium-sized firms and introduces the articles dedicated to this issue.