Regulation and the Ownership Structure of European Listed Firms

Marc Steffen Rapp, Oliver Trinchera

    Research output: Chapter in Book/Report/Conference proceedingBook chapterResearchpeer-review

    Abstract

    In this paper, we explore an extensive panel data set covering more than 4,000 listed firms in 16 European countries to study the effects of shareholder protection on ownership structure and firm performance. We document a negative firm-level correlation between shareholder protection and ownership concentration. Differentiating between shareholder types, we find that this pattern is mainly driven by strategic investors. In contrast, we find a positive correlation between shareholder protection and block ownership of institutional investors, in particular when we restrict the analysis to independent institutional investors. Finally, we find that independent institutional investors are positively associated with firm valuation as measured by Tobin’s Q. The opposite applies for strategic investors. Overall, our results are consistent with the view that (i) high shareholder protection and (ii) limited ownership by strategic investors make small investors and investors interested in security returns more confident in their investments.
    Original languageEnglish
    Title of host publicationAdvances in Financial Economics : Global Corporate Governance
    EditorsJohn Kose, Anil K. Makhija, Stephen P. Ferris
    Number of pages54
    Volume19
    PublisherEmerald Group Publishing
    Publication date2017
    Pages23-76
    ISBN (Print)9781786351661
    ISBN (Electronic)9781786351654
    DOIs
    Publication statusPublished - 2017
    SeriesAdvances in Financial Economics
    Volume19
    ISSN1569-3732

    Keywords

    • Ownership structure
    • Shareholder protection
    • Institutional ownership
    • Europe
    • G20
    • G32
    • G38

    Cite this

    Rapp, M. S., & Trinchera, O. (2017). Regulation and the Ownership Structure of European Listed Firms. In J. Kose, A. K. Makhija, & S. P. Ferris (Eds.), Advances in Financial Economics: Global Corporate Governance (Vol. 19, pp. 23-76). Emerald Group Publishing. Advances in Financial Economics, Vol.. 19 https://doi.org/10.1108/S1569-373220160000019003
    Rapp, Marc Steffen ; Trinchera, Oliver. / Regulation and the Ownership Structure of European Listed Firms. Advances in Financial Economics: Global Corporate Governance. editor / John Kose ; Anil K. Makhija ; Stephen P. Ferris. Vol. 19 Emerald Group Publishing, 2017. pp. 23-76 (Advances in Financial Economics, Vol. 19).
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    Rapp, MS & Trinchera, O 2017, Regulation and the Ownership Structure of European Listed Firms. in J Kose, AK Makhija & SP Ferris (eds), Advances in Financial Economics: Global Corporate Governance. vol. 19, Emerald Group Publishing, Advances in Financial Economics, vol. 19, pp. 23-76. https://doi.org/10.1108/S1569-373220160000019003

    Regulation and the Ownership Structure of European Listed Firms. / Rapp, Marc Steffen; Trinchera, Oliver.

    Advances in Financial Economics: Global Corporate Governance. ed. / John Kose; Anil K. Makhija; Stephen P. Ferris. Vol. 19 Emerald Group Publishing, 2017. p. 23-76 (Advances in Financial Economics, Vol. 19).

    Research output: Chapter in Book/Report/Conference proceedingBook chapterResearchpeer-review

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    Rapp MS, Trinchera O. Regulation and the Ownership Structure of European Listed Firms. In Kose J, Makhija AK, Ferris SP, editors, Advances in Financial Economics: Global Corporate Governance. Vol. 19. Emerald Group Publishing. 2017. p. 23-76. (Advances in Financial Economics, Vol. 19). https://doi.org/10.1108/S1569-373220160000019003