IDEAS home Printed from https://ideas.repec.org/a/bla/finmgt/v48y2019i2p537-573.html
   My bibliography  Save this article

What Are Boards For? Evidence from Closely Held Firms in Colombia

Author

Listed:
  • Belén Villalonga
  • María‐Andrea Trujillo
  • Alexander Guzmán
  • Neila Cáceres

Abstract

Using a large survey database on the corporate governance practices of privately held Colombian firms, we investigate why firms have boards, and how that choice and the balance of power among the board, controlling shareholders, and minority shareholders affect the trade‐offs between control, liquidity, and growth and, ultimately, firm performance. We find that the probability of having a board increases with the number of shareholders and in family firms. When the preferences of controlling and minority shareholders diverge, as with respect to capital structure and dividend policy, boards support controlling shareholders’ decisions, thereby exacerbating the agency conflict between the two groups of shareholders.

Suggested Citation

  • Belén Villalonga & María‐Andrea Trujillo & Alexander Guzmán & Neila Cáceres, 2019. "What Are Boards For? Evidence from Closely Held Firms in Colombia," Financial Management, Financial Management Association International, vol. 48(2), pages 537-573, June.
    • Handle: RePEc:bla:finmgt:v:48:y:2019:i:2:p:537-573
    DOI: 10.1111/fima.12224
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/fima.12224
    Download Restriction: no
    File URL: https://libkey.io/10.1111/fima.12224?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Michael Ewens & Nadya Malenko, 2020. "Board Dynamics over the Startup Life Cycle," NBER Working Papers 27769, National Bureau of Economic Research, Inc.
    2. Swanpitak, Tanapond & Pan, Xiaofei & Suardi, Sandy, 2020. "The value of family control during political uncertainty: Evidence from Thailand's constitutional change in 201411We are grateful for helpful comments and suggestions provided by Shu-Ching Chou, Wooch," Emerging Markets Review, Elsevier, vol. 44(C).
    3. Filipe Sardo & Elisabete S. Vieira & Zélia Serrasqueiro, 2022. "The role of gender and succession on the debt adjustments of family firm capital structure," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 12(2), pages 349-372, June.
    4. Wu, Xiang & Zhang, Bing, 2024. "Retail investors’ escaping from the bottom and clustering at the top of the trend in China," International Review of Economics & Finance, Elsevier, vol. 93(PB), pages 875-904.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:finmgt:v:48:y:2019:i:2:p:537-573. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/fmaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.