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Corporate governance, ownership and firm value: Drivers of ownership as a good corporate governance mechanism

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  • Lozano, M. Belén
  • Martínez, Beatriz
  • Pindado, Julio

Abstract

This study analyses the role of ownership as a good corporate governance mechanism. We study cross-national differences between companies with different level of investor protection. In addition, we account for the type of owner (young family vs. non-young family businesses) and the owner’s relationship with a second significant shareholder (monitoring vs. collusion). When the main owner has effective control over the firm (i.e., absolute control or less than absolute control but without the control of a second significant shareholder), the relation between ownership concentration and firm value is U-shaped. Our findings also suggest that the conflicts between majority and minority shareholders are weaker for companies with higher investor protection and young family-owned businesses.

Suggested Citation

  • Lozano, M. Belén & Martínez, Beatriz & Pindado, Julio, 2016. "Corporate governance, ownership and firm value: Drivers of ownership as a good corporate governance mechanism," International Business Review, Elsevier, vol. 25(6), pages 1333-1343.
    • Handle: RePEc:eee:iburev:v:25:y:2016:i:6:p:1333-1343
    DOI: 10.1016/j.ibusrev.2016.04.005
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