Explicating the contextuality of corporate governance through ownership structure and family management: evidence from an emerging economy

Abstract

Purpose This study aims to investigate the impact of family management and ownership structure, including foreign ownership and business group ownership, on corporate performance. Design/methodology/approach Using an agency perspective and a quantitative research methodology, this study examines listed firms in Pakistan from 2009 to 2018. Findings The results suggest that family management and concentrated leadership constrain, whereas family leadership, foreign ownership and group ownership strengthen monitoring effectiveness and corporate performance. These findings imply that the shareholder governance logic offers optimal solutions in an emerging economy, as relational governance may activate agency problems. Originality/value The findings are consistent with the relevance of relational governance mechanisms in the form of family leadership. However, the results suggest that emerging economies require a hybrid governance model to address their unique agency problems, thereby underlining context relevance in corporate governance scholarship. Furthermore, this research adopts a thick view of institutions to clarify institutional embeddedness and corporate governance contextuality in an emerging economy.

Examining the Nexus Between Local Governance Structures and College Students’ Cultural Identity and Confidence-Take Zhejiang as an Example

“…Scholars at home and abroad have defined the local governance structure from a psychological perspective. Although College students all have emphasis, it is not difficult to see that the scope of the local governance structure can be the overall local governance structure, the specific local governance structure in specific fields, or the local governance structure in different states (Hasan et al,2023). In other words, the local governance structure is a whole system that not only involves the level of self-awareness but also includes the level of policy experience that accompanies self-awareness and is affected by the social culture in which it is located.…”

Family control and corporate performance: the role of independent commissioners in reducing agency problems

“…The presence of families as controlling shareholders grants them the authority to select managers who will run the company in the family's interests, which will ultimately have adverse consequences for minority shareholders (Jackling & Johl, 2009;Hasan et al, 2023). The diversion of company resources by controlling shareholders, such as the family in this case, can potentially diminish the company's value and hinder its optimal performance (Li et al, 2015).…”

“…Some studies found that family ownership negatively impacts corporate performance (Arosa et al, 2010;Besim, 2023;Beuren et al, 2016;Chahal & Sharma, 2022;Moolchandani & Kar, 2022). On the other hand, others found that family ownership positively impacts corporate performance (Arteaga & Escribá-Esteve, 2021;Hasan et al, 2023;Jarchow et al, 2023;Pukthuanthong et al, 2013;Sacristán-Navarro et al, 2023;Shyu, 2011). Therefore, these varying outcomes necessitated further research.…”