Ownership Structure and Corporate Performance

PurposeThis study investigates the impact of corporate governance (CG) mechanisms with inclusion of compliance and diligence index on corporate performance (CP) of firms in Nigeria and Ghana. It further examines the moderating effect of financial distress on the relationship between CG and CP.Design/methodology/approachThe study used panel data of 102 nonfinancial listed firms of Nigeria and Ghana stock exchange for the period 2012–2016 with total observation of 510. The study first used OLS in estimating the influence of CG mechanisms on CP. Due to multicollinearity in the independent variables, ridge regression was employed.FindingsIt was revealed that ownership structure index and board compliance and diligence index, board size, board disclosure, ownership structure, shareholders' right and board compliance and diligence index had positive influence on ROA and ROE. Growth of Tobin's Q depends on board procedure and board compliance and diligence index. Also, financial distress (ZFS) negatively moderates the relationship between board structure index, board disclosure index, board procedure index, shareholders' right and performance (ROA and ROE) but negatively moderates between ownership structure index and Tobin's Q.Practical implicationsThis study provides interesting findings to policymakers in full implementation of CG codes as stated by OCED (2015) by West African firms with greater emphasis on compliance and diligence index since it positively influences all CP measures.Originality/valueThe study provides evidence of the importance of the introduction of the new index: compliance and diligence, which looks at disclosure of CSR activities. This has been overlooked by most researchers especially in Africa in assessing quality CG mechanisms.

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Ownership Structure and Corporate Performance from the Perspective of Ultimate Ownership: Evidence from Chinese State-owned Listed Enterprises

International Business Research ◽

10.5539/ibr.v10n1p34 ◽

2016 ◽

Vol 10 (1) ◽

pp. 34 ◽

Cited By ~ 1

Author(s):

Qianguang Xia ◽

Yong Cheng

Keyword(s):

Significant Influence ◽

Ownership Structure ◽

Corporate Performance ◽

Institutional Environment ◽

Stock Exchange ◽

Ultimate Ownership ◽

Chinese State ◽

The Impact

This paper selects 850 state-owned listed enterprises from 2009 to 2014 in China's Shanghai and Shenzhen Stock Exchange to explore the impact of ownership structure on corporate performance from the perspective of ultimate ownership, and takes the endogeneity of ownership structure into deeper consideration. The study finds that ultimate ownership has no significant influence on corporate performance in state-owned enterprises. The separation of two rights and corporate performance shows a significant inverse U-shaped relationship. Taking the institutional environment into account, the inverse U-shaped relationship only exists in areas with poor institutional environment. To a certain degree, there exists the endogeneity of ownership structure.

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The Influence of Ownership Structure on the Corporate Performance of Malaysian Public Listed Companies

Asean Economic Bulletin ◽

10.1355/ae25-2e ◽

2008 ◽

Vol 25 (2) ◽

pp. 195-208 ◽

Cited By ~ 6

Author(s):

Tee Chwee Ming ◽

Chan Sok Gee

Keyword(s):

Ownership Structure ◽

Corporate Performance ◽

Listed Companies

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Managerial Ownership, Board of Directors, Equity-based Compensation and Firm Performance: A Comparative Study between France and the United States

Mediterranean Journal of Social Sciences ◽

10.5901/mjss.2017.v8n1p78 ◽

2017 ◽

Vol 8 (1) ◽

pp. 78-95 ◽

Cited By ~ 1

Author(s):

Mehdi Bouras ◽

Mohamed Imen Gallali

Keyword(s):

Firm Performance ◽

Comparative Study ◽

Board Of Directors ◽

Ownership Structure ◽

Corporate Performance ◽

The Other ◽

Managerial Ownership ◽

Managerial Entrenchment ◽

Non Linear ◽

The One

Abstract The aim of this comparative study between the French and American markets, characterized by a different ownership structure is to examine the relationship between managerial ownership, the board of directors, the equity-based compensation and corporate performance. Regardless of the selected sample, we found on the one hand, a non-linear relationship between managerial ownership and firm performance and on the other hand, in the case of managerial entrenchment board of directors is a substitute for managerial ownership to solve the agency problem. In addition, stock-based compensation is non-linear function with managerial ownership, contrary to previous studies that assume a monotonous or non-significant relationship. The hypothesis of endogeneity is valid only in the American case. This result leads us to believe that the U.S. CEO has a preference to hold a large percentage of shares of firms that generate a good performance to neutralize capital market monitoring. Our study is exclusive in terms of the effect of managerial ownership on corporate performance in terms of comparison between two markets, characterized by a difference in ownership structure. We determine the impact of equity compensation on the one hand, the managerial ownership where all the studies assume either a monotone or neutral relationship between these two variables and on the other hand, the effect of board in the alignment or managerial entrenchment cases.

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