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Ownership concentration and board structure: Alignment and entrenchment effects in an emerging market

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  • Regina M. Lizares

Abstract

This paper explores if controlling shareholders' influence on the board structure allows entrenchment or alignment effects to prevail. Informed primarily by the principal–principal theory and supported by the stewardship and resource dependence theories, this study samples 235 publicly listed Philippine firms from 2015 to 2019 and employs instrumental variable fixed effect panel and probit regression analyses. Results show ownership concentration is positively associated with the proportion of nonindependent, nonexecutive directors on the board and the likelihood of CEO duality, indicating that boards are not completely independent and are likely to generate entrenchment effects.

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  • Regina M. Lizares, 2022. "Ownership concentration and board structure: Alignment and entrenchment effects in an emerging market," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(6), pages 2557-2569, September.
    • Handle: RePEc:wly:mgtdec:v:43:y:2022:i:6:p:2557-2569
    DOI: 10.1002/mde.3544
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    2. Donghua Chen & Xuerui Wei & Huimin Wang, 2022. "Controlling shareholder’s ownership, control rights and related-party transactions – analysis of regulatory effects based on board characteristics," International Entrepreneurship and Management Journal, Springer, vol. 18(4), pages 1577-1604, December.

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