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Institutions Behind Family Ownership and Control in Large Firms
Author(s) -
Peng Mike W.,
Jiang Yi
Publication year - 2010
Publication title -
journal of management studies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 4.398
H-Index - 184
eISSN - 1467-6486
pISSN - 0022-2380
DOI - 10.1111/j.1467-6486.2009.00890.x
Subject(s) - corporate governance , control (management) , shareholder , institution , business , value (mathematics) , accounting , economics , finance , law , political science , management , machine learning , computer science
There is a major debate regarding the role of concentrated family ownership and control in large firms, with three positions suggesting that such concentration is (1) good, (2) bad, or (3) irrelevant for firm value. Why are there such differences? We theorize that the impact of family ownership and control on firm value is associated with the level of shareholder protection embodied in legal and regulatory institutions of a country. Data from 634 publicly listed large family firms in seven Asian countries (Hong Kong, Indonesia, Malaysia, Singapore, South Korea, Taiwan, and Thailand) are used to test our hypotheses. Overall, this article sketches the contours of a cross‐country, institution‐based view of corporate governance, and leads to a more informed understanding of the crucial role of institutions behind family ownership and control in large firms.