I think it's fine in a true "family business" e.g. you wholly own a hardware store or a restaurant and you have your family working there and eventually you hand it off to your children (assuming they want it).
In large public companies or institutions that have shareholders or state owners then it's unfair for an executive or senior administrator to carve out a job for a family member. He's giving them something he doesn't own, unlike in the family business example.
Even in the family business, there should be limits. What if the family business becomesand empire worth >20% of a contries GDP - e.g. Samsung. It is absolutely not reasonable to pass this amount of wealth to children of the founder.
This is correct money-wise. Samsung Group's market cap is around $400-500 billion, while its chairman (the family head) is estimated to be worth $10-15 billion.
It's not as correct decision-making influence-wise. The power balance of "family vs remaining shareholders" is different from what would be assumed purely based on those numbers.
It can be said that Samsung C&T is the actual head subsidiary/control vehicle through which the other subsidiaries are run at the top level, and the family is easily the biggest shareholder in C&T.
The KOSPI, which is what the subsidiaries are listed on (the "group" is not listed), is seen as a bit of a joke by both foreign and domestic investors for that reason. Besides its obvious downsides, it does have upsides as well - the "sacrifice everything for the short-term stock price" that is the norm in the US is less common in Korea for this reason. Corporations work differently.
In large public companies or institutions that have shareholders or state owners then it's unfair for an executive or senior administrator to carve out a job for a family member. He's giving them something he doesn't own, unlike in the family business example.