Research@Lincoln
    • Login
     
    View Item 
    •   Research@Lincoln Home
    • Theses and Dissertations
    • Doctoral (PhD) Theses
    • View Item
    •   Research@Lincoln Home
    • Theses and Dissertations
    • Doctoral (PhD) Theses
    • View Item
    JavaScript is disabled for your browser. Some features of this site may not work without it.

    Three essays on ownership concentration in New Zealand

    Jiang, Hai
    Abstract
    There are two competing theoretical debates about the impact of ownership concentration on organisational outcomes, namely efficient-monitoring hypothesis and conflict-of-interest (strategic-alignment) hypothesis. New Zealand has a distinctively concentrated ownership structure. This raises an important research question: Does concentrated ownership in New Zealand perform an efficient monitoring or opportunistic function? This question remains unanswered due to the very limited research on ownership structure in New Zealand. This research considers three specific where studying the function of ownership concentration is likely to be insightful. Three contexts are: CEO compensation scheme, corporate voluntary disclosures and investor perception of ownership structure in the stock market. This research further contributes to the existing literature by decomposing ownership into four mutually exclusive groups, namely financial institution-, government-, management- and other company-controlled ownership structures. The different impacts of ownership concentration under each type of controlling ownership structure are investigated. The findings of Essay One reveal that concentrated ownership is a significant contributor to the poor CEO compensation pay-for-performance relationship in New Zealand listed companies. However, reduced ownership concentration promotes the alignment between CEO compensation and firm performance. These results imply that large shareholders in New Zealand do not play a monitoring role in curbing managerial power; rather it exacerbates the poor relationship between CEO compensation and firm performance. In Essay Two, regression results show that companies characterised by financial institution-controlled ownership structure tend to make significantly fewer (more) disclosures at high (low) concentration levels. In contrast, firm observations in the high concentration group with government- and management-controlled ownership structures have considerably higher voluntary disclosure scores compared with their low concentration counterparts. With respect to the linearity assumption, the relationship between ownership concentration and voluntary disclosure practices unveil a non-linear pattern, indicating that the efficiency of large shareholders’ monitoring varies with the level of intensity of ownership concentration. The results of Essay Three demonstrate that ownership concentration in general is positively associated with information asymmetry observed around annual report release date. This is supportive of investor-adverse selection towards ownership concentration, and such an adverse selection problem is strongly associated with financial institutional and managerial shareholdings. Also, ownership concentration decreases stock liquidity, so no result is found in line with the ownership concentration liquidity hypothesis. When voluntary disclosure is taken into account, regression results suggest that disclosure significantly attenuates information asymmetry risk related to ownership concentration. This effect is particularly pronounced for firms with management-controlled ownership structure. Findings highlight the importance of corporate disclosures under concentrated ownership structure in eliminating information asymmetry and enhancing market efficiency in New Zealand.... [Show full abstract]
    Keywords
    ownership concentration; ownership structure; CEO compensation pay-for-performance relationship; corporate voluntary disclosure; information asymmetry
    Date
    2009
    Type
    Thesis
    Collections
    • Department of Financial and Business Systems [526]
    • Doctoral (PhD) Theses [959]
    Thumbnail
    View/Open
    jiang_phd.pdf
    Share this

    on Twitter on Facebook on LinkedIn on Reddit on Tumblr by Email

    Metadata
     Expand record
    This service is maintained by Learning, Teaching and Library
    • Archive Policy
    • Copyright and Reuse
    • Deposit Guidelines and FAQ
    • Contact Us
     

     

    Browse

    All of Research@LincolnCommunities & CollectionsTitlesAuthorsKeywordsBy Issue DateThis CollectionTitlesAuthorsKeywordsBy Issue Date

    My Account

    LoginRegister

    Statistics

    View Usage Statistics
    This service is maintained by Learning, Teaching and Library
    • Archive Policy
    • Copyright and Reuse
    • Deposit Guidelines and FAQ
    • Contact Us