Session 48

Revolution: Ownership Structure and Its Implications

Track O

Date: Monday, September 30, 2013

 

Time: 08:00 – 09:15

Paper

Room: Pecan Room


Session Chair:

  • Christine Shropshire, Arizona State University

Title: Different Types of Owners and Unrelated Diversification: The Effect of Owners’ Institutional Origin

Authors

  • Nikolaos Kavadis, Carlos III University of Madrid
  • Xavier Castaner, University of Lausanne

Abstract: We argue that owners’ position regarding a given strategy depends not only on their type according to Brickley et al. (1988) but also on their institutional origin. Specifically, we claim that different owner categories have different preferences about unrelated diversification depending on the normative beliefs about such strategy in their domestic institutional environment. In a sample of 59 French publicly-traded corporations for 2000-2007, we find that domestic shareholders promote unrelated diversification; the effect of domestic shareholders is to a large extent driven by pressure-sensitive shareholders; and when disentangling the Anglo-American shareholder category into pressure-resistant and pressure-sensitive shareholders, Anglo-American pressure-sensitive shareholders promote unrelated diversification, but Anglo-American institutional investors that are supposed to be pressure-resistant do not have a significant influence on unrelated diversification.

Title: Does Ownership Structure Moderate Top Management Behavior in Determining Success of Change? A Knowledge Based Perspective

Authors

  • Mona Bahl, Youngstown State University
  • Aldas Kriauciunas, Purdue University
  • Thomas Brush, Purdue University

Abstract: This study argues that the ownership form moderates the positive relationship between by top managers’ knowledge sharing behavior and success of change. The firms are classified into three types namely, state owned firms, privatized firms and privately founded firms. The fundamental premise is that the managerial incentives offered by each of the three forms of ownership will likely influence success of change. It is hypothesized that the relative strength of the relationship between knowledge transfer by top managers and success of change will vary for state owned firms, privatized firms and privately founded firms. A unique database from four transition economy countries is used to test the hypotheses. The initial results support most of the hypotheses.

Title: Interrupting a Governance Dilemma: Shareholder Voting and its Effects on Monitoring and Compensation

Authors

  • Christine Shropshire, Arizona State University
  • Jonathan Bundy, Arizona State University
  • Ann Buchholtz, Rutgers University

Abstract: The primary research question in this proposal asks: “Does having more ‘active’ shareholders affect internal corporate governance?” More specifically, we seek to understand substantive effects of shareholders voting to withhold their support of corporate directors on the proxy ballot. The reinforcing cycle of intensifying board monitoring and ever-increasing CEO pay has created a governance dilemma in publicly-traded corporations (Hoskisson, Castleton & Withers, 2009). We suggest that shareholder voting offers an intervention to interrupt and potentially reverse these trends. Our findings reveal meaningful outcomes aligned with shareholder activism, including board turnover and executive and director compensation.

Title: Knowledge, Ownership Structure Change at IPO and Firm Performance

Authors

  • Yue Song, Virginia Tech
  • Marc Junkunc, Virginia Tech

Abstract: This paper focuses on how the change of ownership structure at the time of initial public offering (IPO) will raise governance problems and affect the firm’s long-term performance and sustainability after IPO. More specifically, we argue that for high tech firms, founders or venture capitalists (VCs) selling equity at IPO will weaken the firms’ performance afterwards due to incentive mechanisms, information asymmetry and agency cost. The more technical specialized knowledge employed at the firm, the worse the impact of founders and VCs selling. The results of this paper will extend knowledge in the IPO, governance and innovation management literatures. This paper will also have implications for entrepreneurs and shareholders in managing their ownership structure and public investors in making their investment decisions.

All Sessions in Track O...

Sun: 08:00 – 09:15
Session 191: How Governance Mechanisms Influence Strategic Leadership and Decision-Making
Sun: 09:45 – 11:00
Session 192: Individuals and Teams at the Top of the Firm – Current and Emerging Topics
Sun: 11:15 – 12:30
Session 241: What's with the Board? Strategic Decision-Making Processes in the Boardroom
Sun: 15:15 – 16:30
Session 225: Hard Day\'s Night: Government, Regulation, and Control
Sun: 16:45 – 18:00
Session 306: Strategic Leadership and Governance Business Meeting
Mon: 08:00 – 09:15
Session 48: Revolution: Ownership Structure and Its Implications
Session 177: Politics and Monitoring
Session 210: A Little Help from My Friends: Board Capital
Mon: 09:45 – 11:00
Session 46: All You Need Is Love: The Relationship between the Board and the CEO
Session 50: Come Together: Board Composition and Changes
Mon: 14:00 – 15:15
Session 55: I Feel Fine: CEOs and Risk-Taking
Session 140: Individuals, Decision-Making, and Innovation
Mon: 17:00 – 18:15
Session 47: Hey Jude: Top Management Teams
Session 76: Managers and Corporate Strategy
Tue: 08:00 – 09:15
Session 45: Yellow Submarine: Director Characteristics
Tue: 11:00 – 12:15
Session 49: Hello, Goodbye: CEO Transitions, Ascensions, Dismissals
Session 54: Got to Get You into My Life: Innovations and Adoptions
Tue: 15:45 – 17:00
Session 51: Ticket to Ride: Ownership and Control
Session 203: Top, Middle, and Front Managers in Strategy Process
Tue: 17:15 – 18:30
Session 38: IPOs & Strategic Entrepreneurship
Session 52: Help! Bad CEOs
Session 216: We Can Work It Out: TMT Decision Making


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