BazEkon - Biblioteka Główna Uniwersytetu Ekonomicznego w Krakowie

BazEkon home page

Meny główne

Autor
Aluchna Maria (SGH Warsaw School of Economics), Kuszewski Tomasz (University of Economics and Human Sciences in Warsaw, Poland)
Tytuł
Pyramidal Ownership and Company Value: Evidence from Polish Listed Companies
Źródło
Contemporary Economics, 2021, vol. 15, nr 4, s. 479-498, tab., bibliogr. 76 poz.
Słowa kluczowe
Prawo własności, Wartość przedsiębiorstwa
Ownership, Enterprise value
Uwagi
Klasyfikacja JEL: M21, L25
summ.
Abstrakt
This paper examines the effects of pyramidal ownership. Using the sample of 162 non-financial companies listed on the Warsaw Stock Exchange during the period 2010-2014, we verify the relation between the adoption of a pyramidal structure and company value. Specifically, we show that the link between pyramidal ownership and company value is more complex than previously thought addressing the aspect of ownership concentration and dual class shares. Our results indicate that the use of pyramids is associated with a higher value measured by Tobin's Q, supporting the efficient monitoring hypothesis. Contrary to our expectations the combination of pyramidal ownership and dual class shares is correlated with lower Q. Finally, while the adoption of a pyramid by a majority shareholder does not impact firm value, the combination of a pyramid, ownership concentration and dual class shares is associated with higher Q. This finding suggests that the blockholder ownership outweighs the possible cost of excessive disproportionate ownership and that pyramids and dual class shares have different effects on company value. (original abstract)
Pełny tekst
Pokaż
Bibliografia
Pokaż
  1. Adams, R., & Ferreira, D. (2008). One share-one vote: The empirical evidence. Review of Finance, 12(1), 51-91. https://doi.org/10.1093/rof/rfn003
  2. Aldrighi, D.M., Postali, F.A., & Diaz, M.D. (2018). Corporate governance and pyramidal ownership: The role of Novo Mercado. Revista Brasileira Finanças, 16(1), 5-38. https://doi.org/10.12660/rbfin.v16n1.2018.72020
  3. Almeida, H., & Wolfenzon, D. (2006). A theory of pyramidal ownership and family business groups. Journal of Finance, 61(6), 2637-2680. https://doi.org/10.1111/j.1540-6261.2006.01001.x
  4. Almeida, H., Park, S.Y., & Subrahmanyam, M., Wolfenzon, D. (2011). The structure and formation of business groups: Evidence from Korean chaebols. Journal of Financial Economics, 99(2), 447-475. https://doi.org/10.1016/j.jfineco.2010.08.017
  5. Amoako-Adu, B., & Smith B.F. (2001). Dual class firms: Capitalization, ownership structure and recapitalization back into single class. Journal of Banking and Finance, 25(6), 1083-1111. https://doi.org/10.1016/S0378-4266(00)00107-2
  6. Atavasov, V., Black, B., & Ciccotello C. (2011). Law and tunneling. Journal of Corporation Law, 37, 1-49.
  7. Attig, N, Fischer, K., & Galdhoum J. (2004). On the determinants of pyramidal ownership: evidence on dilution of minority interests. EFA 2004 Maastricht Meetings Paper No. 4592.
  8. Bae, K. H., & Jeong, S. W. (2007). The value-relevance of earnings and book value, ownership structure and business groups affiliation: Evidence from Korean business groups. Journal of Business, Finance and Accounting, 34(5-6), 740-766. https://doi.org/10.1111/j.1468-5957.2007.02017.x
  9. Baek, J.-S., Kang, J.-K., & Park, K.-S. (2004). Corporate governance and firm value: Evidence from the Korean financial crisis. Journal of Financial Economics, 71(2), 265-313. https://doi.org/10.1016/S0304-405X(03)00167-3
  10. Bank, S., & Cheffins, B. (2010). The corporate pyramid fable. Business History Review, 84(3), 435-458. https://doi.org/10.1017/S0007680500002191
  11. Bany-Ariffin, A., Nor F., & McGowan, C. (2010). Pyramidal structure, firm capital structure exploitation and ultimate owners' dominance. International Review of Financial Analysis, 19(3), 151-164. https://doi.org/10.1016/j.irfa.2010.03.002
  12. Bedo, Z., & Acs, B. (2007). The impact of ownership concentration, and identity on company performance in the US and in Central and Eastern Europe. Baltic Journal of Management, 2(2), 125-139. https://doi.org/10.1108/17465260710750955
  13. Bena, J., & Ortiz-Molina, H. (2013). Pyramidal ownership and the creation of new firms. Journal of Financial Economics, 108(3), 798-821. https://doi.org/10.1016/j.jfineco.2013.01.009
  14. Bennedsen, M., & Nielsen, K. (2010). Incentive and entrenchment effects in European ownership. Journal of Banking and Finance, 34(9), 2212-2229. https://doi.org/10.1016/j.jbankfin.2010.02.007
  15. Boubaker, S. (2007). Ownership-control discrepancy and firm value: Evidence from France. Multinational Finance Journal, 11(3,4), 211-252. https://doi.org/10.2139/ssrn.740756
  16. Bozec, Y., Bozec, R., & Dia, M. (2010). Overall governance, firm value and deviation from one share-one vote principle. International Journal of Managerial Finance, 6(4),305-328. https://doi.org/10.1108/17439131011074468
  17. Brüderl, J. (2015). Applied panel data analysis using Stata, Panel Analysis, Ludwig-Maximilians Universität München.
  18. Buchuk, D., Larrain, B., Prem, M., & Infante F. (2020). How do internal capital markets work? Evidence from the great recession. Review of Finance, 24(4), 847-889. https://doi.org/10.1093/rof/rfz022
  19. Buchuk, D., Larrain, F., Muñoz F., & Urzúa F. (2014). The internal capital markets of business groups: Evidence from intra-group loans. Journal of Financial Economics, 112 (2), 190-212. https://doi.org/10.1016/j.jfineco.2014.01.003
  20. Cameron, A., & Trivedi, P. (2005). Microeconometrics. Methods and applications, Cambridge University Press.
  21. Choi, D., Choi, S., Gam, J.K., & Shin, H. (2021). R&D investment decisions in business groups: Evidence from a natural experiment. Corporate Governance International Review, 1-25, https://doi.org/10.1111/corg.12407
  22. Claessens, S., Diankov, S., & Lang, H. (2000). The separation of ownership and control in East Asian corporation. Journal of Finance, 58(1-2), 81-112. https://doi.org/10.1016/S0304-405X(00)00067-2
  23. Claessens, S., Diankov, S., Fan, J., & Lang, H. (2002). Disentangling the incentive and entrenchment effects of large shareholdings. Journal of Finance, 57(6), 2741-2771. https://doi.org/10.1111/1540-6261.00511
  24. Cornett, M., Marcus, A., & Saunders, A. (2007). The impact of institutional ownership on corporate operating performance. Journal of Banking and Finance, 31(6), 1771-1794. https://doi.org/10.1016/j.jbankfin.2006.08.006
  25. Cronqvist, H., & Nilsson, M. (2003). Agency costs of controlling minority shareholders. Journal of Financial and Quantitative Analysis, 38(4), 695-719. https://doi.org/10.2307/4126740
  26. De Angelo, H., & De Angelo, L. (1985). Managerial ownership of voting rights: A study of public corporations with dual classes of common stock. Journal of Financial Economics, 14(1), 33-69. https://doi.org/10.1016/0304-405X(85)90043-1
  27. Demsetz H., & Lehn K. (1985). The structure of corporate ownership: Causes and consequences. Journal of Political Economy, 93(6), 1155-1177. https://doi.org/10.1086/261354
  28. Djebali, R., & Belanès, A. (2015). On the impact of family versus institutional blockholders on dividend policy. Journal of Applied Business Research, 31(4), 1329-1342. https://doi.org/10.19030/jabr.v31i4.9320
  29. Espinoza-Méndez, Ch., Jara-Bertín, M., & Maquiera C. (2018). The influence of family and pyramidal ownership on corporate diversification in Chile. The North American Journal of Economics and Finance, 43, 158-168. https://doi.org/10.1016/j.najef.2017.10.012
  30. Faccio, M., & Lang L. (2002). The ultimate ownership of Western European corporations. Journal of Financial Economics, 65(3), 365-395. https://doi.org/10.1016/S0304-405X(02)00146-0
  31. Florackis, C., A. Kanas, & Kostakis A. (2015). Dividend policy, managerial ownership and debt financing: A non-parametric perspective. European Journal of Operational Research, 214(3), 783-795. https://doi.org/10.1016/j.ejor.2014.08.031
  32. Gama, M. A. B., & Bandeira-de-Mello, R. (2021). The effect of affiliation structure on the performance of pyramidal business groups. Journal of Business Research, 124, 24-37. https://doi.org/10.1016/j.jbusres.2020.11.041
  33. Gilson, R., & Schwarz, A. (2013). Contracting about private benefits of control. Columbia Law and Economics Research Paper no. 436. https://law.stanford.edu/wp-content/uploads/sites/default/files/publication/359494/doc/slspublic/ssrn-id2182781.pdf
  34. Gonenc, H., Kan, O., & Karadagli E. (2007). Business groups and internal capital market. Emerging Markets, Finance and Trade, 43(2), 63-81. https://doi.org/10.2753/REE1540-496X430204
  35. Han Kim, E., & Kim, W. (2008). Changes in Korean corporate governance: A response to crisis. Journal of Applied Corporate Finance, 20(1), 47-58. https://doi.org/10.7312/chew14854-010
  36. Hardi, P., & Buti, K. (2012). Corporate governance variables: Lessons from a holistic approach to Central-Eastern European practice. Corporate Governance, 12(1), 101-117. https://doi.org/10.1108/14720701211191364
  37. Holmén M., & Högfeldt P. (2005). Pyramidal discounts: Tunneling or agency costs? Finance Working Paper, no. 73, European Corporate Governance Institute.
  38. Holmén, M., & Högfeldt, P. (2009). Pyramidal discounts: Tunneling or overinvestment? International Review of Finance, 9(1-2), 133-175. https://doi.org/10.1111/j.1468-2443.2009.01088.x
  39. Holmén, M., & Nivorozhkin, E. (2007). The impact of family ownership and dual class shares on takeover risk. Applied Financial Economics, 17(10), 785-804. https://doi.org/10.1080/09603100500461694
  40. Hussain, H., Ali, A., Thaker H., & Ali, M. (2019). Firm performance and family related directors: Empirical evidence from an emerging market. Contemporary Economics, 13(2), 187-204. https://doi.org/10.5709/ce.1897-9254.307
  41. Jara-Bertin, M., López-Iturriaga, F., & López-de-Foronda O. (2008). The contest to the control in European family firms: How other shareholders affect firm value. Corporate Governance: An International Review, 16(3), 146-159. https://doi.org/10.1111/j.1467-8683.2008.00677.x
  42. Khanna, T., & Palepu, K. (2000). Is group affiliation profitable in emerging markets? An analysis of diversified Indian business groups. Journal of Finance, 55(2), 867-891. https://doi.org/10.1111/0022-1082.00229
  43. Khanna, T., & Rivkin, J. (2001). Estimating the performance effects on business groups in emerging markets. Strategic Management Journal, 22(1), 45-74. https://doi.org/10.1002/1097-0266(200101)22:1<45::AID-SMJ147>3.0.CO;2-F
  44. Koop, G. (2008). Introduction to Econometrics. Wiley & Sons Ltd.
  45. La Porta, R., Lopez-de-Silanes F., & Shleifer, A. (1999). Corporate ownership around the world. Journal of Finance, 54(2), 471-517. https://doi.org/10.1111/0022-1082.00115
  46. Lemmon, M., & Lins K. (2003). Ownership structure, corporate governance, and firm value: Evidence from the East Asian Financial crisis. Journal of Finance, 58(4), 1445-1468. https://doi.org/10.1111/1540-6261.00573
  47. Lin, J. J., & Yeh, Y-H. (2020). Internal capital markets, ownership structure, and investment efficiency: Evidence from Taiwanese business groups. Pacific-Basin Finance Journal, 60. https://doi.org/10.1016/j.pacfin.2020.101284
  48. Luo, J.-H., Li, X., Wang, L. C., & Liu, Y. (2021). Owner type, pyramidal structure and R&D Investment in China's family firms. Asia Pacific Journal of Management, 38, 1085-1111. https://doi.org/10.1007/s10490-019-09702-z
  49. Ly, T. T. H., & Duc, N. K. (2018). Corporate governance, pyramid ownership, and firm value: Evidence from Vietnam. Journal of Asian Business and Economic Studies, 25(1), 85-102. https://doi.org/10.24311/jabes/2018.25.S01.4
  50. Marchica, M., & Mura, R. (2005). Direct and Ultimate Ownership structures in the UK: An intertemporal perspective over the last decade. Corporate Governance, 13(1), 26-45. https://doi.org/10.1111/j.1467-8683.2005.00401.x
  51. Masulis, R., Pham, P., & Zein, J. (2011). Family business groups around the world: Financing advantages, control motivations, and organizational choices. Review of Financial Studies, 24, 3556-3600. https://doi.org/10.1093/rfs/hhr052
  52. Maug, E. (1997). Boards of directors and capital structure: alternative forms of corporate restructuring. Journal of Corporate Finance, 3, 113-139. https://doi.org/10.1016/S0929-1199(96)00010-7
  53. Mindzak, J. & Zeng, T. (2018). The impact of pyramid ownership on earnings management. Asian Review of Accounting, 26(2), 208-224. https://doi.org/10.1108/ARA-11-2016-0130
  54. Morck, R. (2005). How to eliminate pyramidal business groups - the double taxation of inter-corporate dividends and other incisive uses of tax policy. Tax Policy and the Economy, 19, 135-179. https://doi.org/10.1086/tpe.19.20061898
  55. Morck, R., Percy, M., Tian, G., & Yeung B. (2005). The rise and fall of the widely held firm: A history of corporate ownership in Canada In R. Morck (Ed.) A history of corporate governance around the world: Family business groups to professional managers, University of Chicago Press, 65-148.
  56. Nenova, T. (2003). The value of corporate voting rights and control: A cross-country analysis. Journal of Financial Economics, 68(3), 325-351. https://doi.org/10.1016/S0304-405X(03)00069-2
  57. Perkins, S., Morck, R., & Young, B. (2014). Innocents abroad: The hazards of international joint ventures with pyramidal group firms. Global Strategy Journal, 4(4), 310-330. https://doi.org/10.1002/gsj.1087
  58. Pursey, P., Heugens, P., & Zyglidopoulos, S. (2008). From social ties to embedded competencies: the case of business groups. Journal of Management & Governance, 12(4), 325-341. https://doi.org/10.1007/s10997-008-9064-7
  59. Renneboog, L. (1999). Shareholdings concentration and pyramidal ownership structures in Belgium: Stylized facts, Onderzoeksrapport Nr. 9634, Department Toegepaste Econmische Wetenschappen, Katholieke Universiteit Leuven, 1-48.
  60. Renneboog, L. (2000). Ownership, managerial control and the governance of companies listed on the Brussels stock exchange. Journal of banking & finance, 24(12), 1959-1995. https://doi.org/10.1016/S0378-4266(99)00128-4
  61. Riyanto, Y., & Toolsema, L. (2008). Tunneling and propping: A justification for pyramidal ownership. Journal of Banking and Finance, 32(10), 2178-2187. https://doi.org/10.1016/j.jbankfin.2007.12.044
  62. Sánchez-Ballesta, J., & García-Meca, E. (2007). A metaanalytic vision of the effect of ownership structure on firm performance. Corporate Governance: An International Review, 15(5), 879-892. https://doi.org/10.1111/j.1467-8683.2007.00604.x
  63. Shah, M.H., Xiaob, Z., Abdullahc , Qureshd, S., & Ahmad, M. (2020). Internal pyramid structure, contract enforcement, minority investor protection, and firms' performance: Evidence from emerging economies. Research in International Business and Finance, 52, https://doi.org/10.1016/j.ribaf.2019.101170
  64. Shleifer, A., & Vishny, R. (1997). A survey of corporate governance. Journal of Finance, 52, 737-783. https://doi.org/10.1111/j.1540-6261.1997.tb04820.x
  65. Smart, S.B., & Zutter, C.J. (2003). Control as a motivation for underpricing: A comparison of dual and single-class IPOs. Journal of Financial Economics, 69(1), 85-110. https://doi.org/10.1016/S0304-405X(03)00109-0
  66. Su, K. (2015). The inner structure of pyramid and capital structure: Evidence from China. Economics: The Open-Access, Open-Assessment E-Journal 9. https://doi.org/10.5018,economics-eJ.ournal.J.a.2015-14
  67. Su, K., Wan, R., & Song, W.Y. (2018). Pyramidal structure, risk-taking and firm value1 Evidence from Chinese local SOEs. Economics of Transition Volume, 26(3), 401-427. https://doi.org/10.1111/ecot.12156
  68. Su, Y., Xu, D., & Phan, P. (2008). Principal-principal conflict in the governance of the Chinese public corporation. Management and Organization Review, 4(1), 17-38. https://doi.org/10.1111/j.1740-8784.2007.00090.x
  69. Taylor, S., & Whittred, G. 1998. Security design and the allocation of voting rights: Evidence from the Australian IPO market. Journal of Corporate Finance, 4(2), 107-131. https://doi.org/10.1016/S0929-1199(97)00012-6
  70. Villalonga, B., & Amit, R. (2008). How are US family firms controlled? Review of Financial Studies, 22(8), 3047-3091. https://doi.org/10.1093/rfs/hhn080
  71. Vintila, G., Gherghina S.C., & Nedelescu M. (2014). The effects of ownership concentration and origin on listed firms' value. Empirical evidence from Romania. Romanian Journal of Economic Forecasting, 17(3), 51-71.
  72. Wang, H.-D., Lin, Ch.-H., Cho, Ch.-Ch. (2020). The dark and bright sides of agency problems: Evidence from insider compensation of family pyramidal firms. Asia Pacific Management Review 25(3), 122-133.
  73. Wooldrigde, J. 2000. Introductory Econometrics. A Modern Approach, South-Western College Publishing.
  74. Young, M., Peng, M., Alstrom, D., Bruton G., & Jiang, Y. (2008). Corporate governance in emerging economies: A review of the principal-principal perspective. Journal of Management Studies, 45(1), 196-220. https://doi.org/10.1111/j.1467-6486.2007.00752.x
  75. Yurtoglu, B. (2003). Corporate governance and implications for minority shareholders in Turkey. Journal of Corporate Ownership and Control, 1, 72-86.
  76. Zattoni, A. 1999. The structure of corporate groups: The Italian case. Corporate Governance, 7(1), 38-48.
Cytowane przez
Pokaż
ISSN
2084-0845
Język
eng
URI / DOI
http://dx.doi.org/10.5709/ce.1897-9254.462
Udostępnij na Facebooku Udostępnij na Twitterze Udostępnij na Google+ Udostępnij na Pinterest Udostępnij na LinkedIn Wyślij znajomemu