Ownership and Ownership Concentration: Which is More Important in Determining the Performance of China's Listed Firms?

Accounting and Finance, Forthcoming

39 Pages Posted: 16 Sep 2014

See all articles by Shiguang Ma

Shiguang Ma

University of Wollongong - School of Accounting Economics and Finance

Tony Naughton (Deceased)

Royal Melbourne Institute of Technolog (RMIT University) - School of Economics, Finance and Marketing; Financial Research Network (FIRN)

Gary Gang Tian

Macquarie University - Department of Applied Finance and Actuarial Studies; Macquarie University, Macquarie Business School

Date Written: September 14, 2014

Abstract

This paper investigates the impact of ownership and ownership concentration on the performance of China’s listed firms. By recognizing the differences between ownership and ownership concentration, and between total ownership concentration and tradable ownership concentration, we find that ownership concentration is more powerful than any category of ownership in determining firm performance and that it has approximately positive linear relations with firm value. The tradable ownership concentration has a more significant and positive influence on firm performance than total ownership concentration. The highest level of firm performance is approached when a firm is characterized with both total ownership concentration and tradable ownership concentration. Thus, we conclude that it is a rule that ownership concentration enhances firm performance regardless of who the concentrated owners are.

Keywords: ownership, concentration, performance, state, legal person, tradable shares

JEL Classification: G32; G34

Suggested Citation

Ma, Shiguang and Naughton (Deceased), Tony and Tian, Gary Gang, Ownership and Ownership Concentration: Which is More Important in Determining the Performance of China's Listed Firms? (September 14, 2014). Accounting and Finance, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2496169 or http://dx.doi.org/10.2139/ssrn.2496169

Shiguang Ma

University of Wollongong - School of Accounting Economics and Finance ( email )

Northfields Avenue
Wollongong, NSW 2522
Australia

Tony Naughton (Deceased)

Royal Melbourne Institute of Technolog (RMIT University) - School of Economics, Finance and Marketing ( email )

Business
Level 12, 239 Bourke Street
Melbourne, Victoria 3000
Australia

Financial Research Network (FIRN)

C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia

HOME PAGE: http://www.firn.org.au

Gary Gang Tian (Contact Author)

Macquarie University - Department of Applied Finance and Actuarial Studies ( email )

Room 513, Building E4A
North Ryde, NSW, 2109
Australia

Macquarie University, Macquarie Business School ( email )

New South Wales 2109
Australia

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