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Ownership structure, corporate governance, and enterprise performance: Empirical results for ukraine

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  • Iryna Akimova
  • Gerhard Schwödiauer

Abstract

This paper examines the effect of ownership structure on corporate governance and performance of privatized enterprises in transition. The data are taken from a survey conducted in 2001 on 202 medium and large firms in Ukraine for the period 1998–2000. The ownership structure is measured by the percentage of shares held by each type of owner (state, managers, workers, Ukrainian concentrated outsiders, foreign concentrated owners, and stake-holding shareholders). Performance is measured by sales per employee. Regression analysis is used to test the hypothesis that concentrated outside ownership influences performance positively and to detect non-linear effects of ownership variables on performance. In contrast, with important previous studies on enterprise restructuring in Ukraine [Estrin and Rosevear, 1999], significant ownership effects on performance are found. Insider ownership (being a special case of stakeholding ownership) is found to have a significant non-linear effect on performance—positive within a lower range but negative from a threshold close to majority ownership onwards. In general, Ukrainian outside owners do not have a significant effect on performance. However, stakeholding ownership by customers affect sale prices and performance negatively. The most robust results are obtained for the effects of concentrated foreign ownership, both for levels of the respective variables in each year and for changes from one year to the other. The impact of foreign ownership on performance is significantly non-linear: its effect is positive only up to a level that falls short of majority ownership. It is concluded that this non-linearity is due to an institutional environment still adverse to foreign direct investment. Copyright International Atlantic Economic Society 2004

Suggested Citation

  • Iryna Akimova & Gerhard Schwödiauer, 2004. "Ownership structure, corporate governance, and enterprise performance: Empirical results for ukraine," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 10(1), pages 28-42, February.
    • Handle: RePEc:kap:iaecre:v:10:y:2004:i:1:p:28-42:10.1007/bf02295575
    DOI: 10.1007/BF02295575
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    References listed on IDEAS

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    Cited by:

    1. Vitaliy Zheka, 2006. "Corporate Governance and Firm Performance in Ukraine," CERT Discussion Papers 0605, Centre for Economic Reform and Transformation, Heriot Watt University.
    2. repec:kap:iaecre:v:13:y:2007:i:4:p:488-494 is not listed on IDEAS
    3. Eman Fathi Attia & Messaoud Mehafdi, 2023. "The Dynamic Endogeneity Issue between Corporate Ownership Structure and Real-Based Earnings Manipulation in an Emerging Market: Advanced Dynamic Panel Model," Risks, MDPI, vol. 11(11), pages 1-27, October.
    4. Eric Ernest Mang¡¯unyi, 2011. "Ownership Structure and Corporate Governance andIts Effects on Performance: A Case of Selected Banks in Kenya," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 2(3), pages 2-18, August.
    5. Joaquín Guzmán Cuevas & Felipe Cáceres Carrasco, 2007. "Entrepreneurial Structure Qualitative Analysis: The Case of Seville (Spain)," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 13(4), pages 488-494, November.
    6. Đặng, Rey & Le, Nhu Tuyen & Reddy, Krishna & Vu, Manh Chien, 2022. "Foreign ownership and corporate risk-taking: Panel threshold evidence from a transactional economy," Finance Research Letters, Elsevier, vol. 45(C).

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