Pension reform, ownership structure, and corporate governance

Evidence from Sweden

M. Giannetti, L. Laeven

Research output: Contribution to journalArticleScientificpeer-review

Abstract

Sweden offers a unique natural experiment to analyze the effects of institutionalized saving on the ownership structure, corporate governance, and firm performance. The Swedish pension reform increased the stock market participation of pension funds, causing a significant reshuffling in the ownership of pension funds. We show that the effects of institutional investment on firm performance depend on the industry structure of pension funds. Firm valuation improves if public pension funds and large independent private pension funds increase their shareholdings. Additionally, controlling shareholders appear reluctant to relinquish control and the control premium increases if public pension funds acquire shares.
Original languageEnglish
Pages (from-to)4091-4127
JournalThe Review of Financial Studies
Volume22
Issue number10
Publication statusPublished - 2009

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Corporate governance
Sweden
Pension reform
Pension funds
Ownership structure
Firm performance
Public pensions
Stock market participation
Private pensions
Industry structure
Ownership
Firm valuation
Institutional investment
Shareholding
Natural experiment
Controlling shareholders
Premium

Cite this

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Pension reform, ownership structure, and corporate governance : Evidence from Sweden. / Giannetti, M.; Laeven, L.

In: The Review of Financial Studies, Vol. 22, No. 10, 2009, p. 4091-4127.

Research output: Contribution to journalArticleScientificpeer-review

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