The Impact of Ownership Structure on Firm Performance

Evidence From a Large Emerging Market

S.W. Douma, R. George, M.R. Kabir

Research output: Working paperDiscussion paperOther research output

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Abstract

We examine how ownership structure affects the performance of firms using firm level data from a large emerging market, India.We specifically focus on a previously unexplored phenomenon, namely the differential role played by foreign institutional and foreign corporate shareholders.An examination of more than one thousand Indian listed firms suggests that the positive effect on firm performance of foreign ownership is attributable to foreign corporations that have, on average, a larger shareholding and a higher degree of commitment and long-term involvement.Furthermore, we document the positive influence of domestic corporations, which are by far the largest blockholders with significant monitoring potential.We find an interesting dichotomy in their monitoring influence depending on whether they have a group affiliation.We also perform an analysis of group firms, the results of which generally suggest a negative impact on firm performance.
Original languageEnglish
Place of PublicationTilburg
PublisherOrganization
Number of pages51
Volume2002-104
Publication statusPublished - 2002

Publication series

NameCentER Discussion Paper
Volume2002-104

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Emerging markets
Ownership structure
Firm performance
Monitoring
Blockholders
Firm-level data
India
Foreign ownership
Shareholding
Shareholders
Dichotomy

Keywords

  • corporate governance
  • corporate ownership
  • corporate performance

Cite this

Douma, S. W., George, R., & Kabir, M. R. (2002). The Impact of Ownership Structure on Firm Performance: Evidence From a Large Emerging Market. (CentER Discussion Paper; Vol. 2002-104). Tilburg: Organization.
Douma, S.W. ; George, R. ; Kabir, M.R. / The Impact of Ownership Structure on Firm Performance : Evidence From a Large Emerging Market. Tilburg : Organization, 2002. (CentER Discussion Paper).
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Douma, SW, George, R & Kabir, MR 2002 'The Impact of Ownership Structure on Firm Performance: Evidence From a Large Emerging Market' CentER Discussion Paper, vol. 2002-104, Organization, Tilburg.

The Impact of Ownership Structure on Firm Performance : Evidence From a Large Emerging Market. / Douma, S.W.; George, R.; Kabir, M.R.

Tilburg : Organization, 2002. (CentER Discussion Paper; Vol. 2002-104).

Research output: Working paperDiscussion paperOther research output

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Douma SW, George R, Kabir MR. The Impact of Ownership Structure on Firm Performance: Evidence From a Large Emerging Market. Tilburg: Organization. 2002. (CentER Discussion Paper).