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Article: An empirical study on the relationship between ownership and performance in a family-based corporate environment
Title | An empirical study on the relationship between ownership and performance in a family-based corporate environment |
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Authors | |
Issue Date | 2005 |
Publisher | Greenwood Publishing Group Inc. The Journal's web site is located at http://w4.stern.nyu.edu/ross/research.cfm?doc_id=1746 |
Citation | Journal Of Accounting, Auditing And Finance, 2005, v. 20 n. 2, p. 121-146 How to Cite? |
Abstract | This study examines the relationship between family ownership and firm performance in a family-based corporate environment in which managerial ownership is used as a proxy for family ownership. The relationship is in cubic form with a pattern of "entrenchment-alignment-entrenchment," which is the reverse of that found in earlier U.S. and U.K. studies. This confirms that research based on U.S. and U.K. evidence is not applicable to East-Asian corporations due to the differences in ownership concentration. Taking the endogeneity issue into consideration, the simultaneous equations regression analysis confirms that in a family-owned corporate structure, ownership affects performance and not vice versa. The wide range of alignment in the nonmonotonic relationship supports the classical "convergence of interest" hypothesis. However, at a very high level of ownership, the entrenchment effect becomes dominant. This indicates that if the family form of ownership can be controlled and made use of appropriately, firm performance can be optimized due to convergence of interest. It also follows that a company with high ownership concentration should pay even more attention to improving corporate governance practices in order to enhance its performance. |
Persistent Identifier | http://hdl.handle.net/10722/177963 |
ISSN | 2023 Impact Factor: 1.3 2023 SCImago Journal Rankings: 0.854 |
SSRN | |
ISI Accession Number ID | |
References |
DC Field | Value | Language |
---|---|---|
dc.contributor.author | Ng, CYM | en_US |
dc.date.accessioned | 2012-12-19T09:41:00Z | - |
dc.date.available | 2012-12-19T09:41:00Z | - |
dc.date.issued | 2005 | en_US |
dc.identifier.citation | Journal Of Accounting, Auditing And Finance, 2005, v. 20 n. 2, p. 121-146 | en_US |
dc.identifier.issn | 0148-558X | en_US |
dc.identifier.uri | http://hdl.handle.net/10722/177963 | - |
dc.description.abstract | This study examines the relationship between family ownership and firm performance in a family-based corporate environment in which managerial ownership is used as a proxy for family ownership. The relationship is in cubic form with a pattern of "entrenchment-alignment-entrenchment," which is the reverse of that found in earlier U.S. and U.K. studies. This confirms that research based on U.S. and U.K. evidence is not applicable to East-Asian corporations due to the differences in ownership concentration. Taking the endogeneity issue into consideration, the simultaneous equations regression analysis confirms that in a family-owned corporate structure, ownership affects performance and not vice versa. The wide range of alignment in the nonmonotonic relationship supports the classical "convergence of interest" hypothesis. However, at a very high level of ownership, the entrenchment effect becomes dominant. This indicates that if the family form of ownership can be controlled and made use of appropriately, firm performance can be optimized due to convergence of interest. It also follows that a company with high ownership concentration should pay even more attention to improving corporate governance practices in order to enhance its performance. | en_US |
dc.language | eng | en_US |
dc.publisher | Greenwood Publishing Group Inc. The Journal's web site is located at http://w4.stern.nyu.edu/ross/research.cfm?doc_id=1746 | en_US |
dc.relation.ispartof | Journal of Accounting, Auditing and Finance | en_US |
dc.title | An empirical study on the relationship between ownership and performance in a family-based corporate environment | en_US |
dc.type | Article | en_US |
dc.identifier.email | Ng, CYM: chring@hkucc.hku.hk | en_US |
dc.identifier.authority | Ng, CYM=rp01087 | en_US |
dc.description.nature | link_to_subscribed_fulltext | en_US |
dc.identifier.scopus | eid_2-s2.0-33645687902 | en_US |
dc.relation.references | http://www.scopus.com/mlt/select.url?eid=2-s2.0-33645687902&selection=ref&src=s&origin=recordpage | en_US |
dc.identifier.volume | 20 | en_US |
dc.identifier.issue | 2 | en_US |
dc.identifier.spage | 121 | en_US |
dc.identifier.epage | 146 | en_US |
dc.identifier.isi | WOS:000211960900002 | - |
dc.publisher.place | United States | en_US |
dc.identifier.ssrn | 1508218 | - |
dc.identifier.scopusauthorid | Ng, CYM=15035998200 | en_US |
dc.identifier.issnl | 0148-558X | - |