Dynastic Control Without Ownership: Evidence from Post-War Japan

35 Pages Posted: 26 Oct 2020 Last revised: 30 Oct 2020

See all articles by Morten Bennedsen

Morten Bennedsen

INSEAD - Economics and Political Sciences; University of Copenhagen - Department of Economics

Vikas Mehrotra

University of Alberta - Department of Finance and Statistical Analysis

Jungwook Shim

Kyoto Sangyo University

Yupana Wiwattanakantang

National University of Singapore - Department of Finance ; European Corporate Governance Institute (ECGI)

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Date Written: October 23, 2020

Abstract

Dynastic-controlled firms are led by founding family CEOs while the family owns an insignificant share of equity (defined as less than five percent). They represent 7.4% of listed firms in post-war Japan, include well-known firms such as Casio, Suzuki and Toyota, and are often grouped with widely-held firms in the literature. These firms differ in key performance measures from both traditional family firms and non-family firms, and evolve from the former as equity-financed growth dilutes the founding family’s ownership over time. In turn, the transition from dynastic control to non-family status is driven by a diminution of strategic family resources.

Keywords: Family control, Ownership, Succession

JEL Classification: G32, L26

Suggested Citation

Bennedsen, Morten and Mehrotra, Vikas and Shim, Jungwook and Wiwattanakantang, Yupana, Dynastic Control Without Ownership: Evidence from Post-War Japan (October 23, 2020). European Corporate Governance Institute – Finance Working Paper No. 705/2020, Available at SSRN: https://ssrn.com/abstract=3717621 or http://dx.doi.org/10.2139/ssrn.3717621

Morten Bennedsen (Contact Author)

INSEAD - Economics and Political Sciences ( email )

Boulevard de Constance
F-77305 Fontainebleau Cedex
France

University of Copenhagen - Department of Economics ( email )

Øster Farimagsgade 5, Bygn 26
Copenhagen, 1353
Denmark

Vikas Mehrotra

University of Alberta - Department of Finance and Statistical Analysis ( email )

School of Business
University of Alberta
Edmonton, Alberta T6G 2R6
Canada
780-492-2976 (Phone)
780-492-3325 (Fax)

Jungwook Shim

Kyoto Sangyo University ( email )

Motoyama, Kamigamo, Kita-ku
Kyoto, Kyoto 603-8555
Japan

HOME PAGE: http://https://www.kyoto-su.ac.jp/faculty/professors/ec/shim-jungwook.html

Yupana Wiwattanakantang

National University of Singapore - Department of Finance ( email )

Business School
Mochtar Riady Building #7-44, 15 Kent Ridge Dri
Singapore, 117592
Singapore
65-6516-1912 (Phone)

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

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