Corporate Governance, Ownership Structure and Firm Performance: Mediation Models and Dynamic Approaches

The relationship between ownership structure and firm performance is explored through a mediation (path) analysis, recognizing agency costs and corporate risk-taking as essential mediators. Two-mediator mediation models are developed to investigate the relationship, highlighting the importance of agency costs and corporate risk-taking in improving firm financial performance. The book is valuable for researchers, policy makers, and postgraduate students in corporate governance and corporate finance.

Format: Paperback / softback
Length: 176 pages
Publication date: 25 September 2023
Publisher: Taylor & Francis Ltd

The relationship between ownership structure and firm performance has been extensively researched in the fields of corporate finance and corporate governance. However, a novel approach known as mediation (path) analysis has emerged to shed light on the underlying reasons and mechanisms linking ownership structure to firm performance and vice versa. This approach recognizes the crucial roles of agency costs and corporate risk-taking as essential mediating variables in the bi-directional and mediated relationship between ownership structure and firm performance.

Drawing upon the agency theory, corporate risk management theory, and accounting for the dynamic endogeneity in the ownership-performance relationship, this book develops two-mediator mediation models, including recursive and non-recursive mediation models, to investigate the ownership structure-firm performance relationship. Through rigorous empirical analysis, it is demonstrated that agency costs and corporate risk-taking are the missing links in the ownership structure-firm performance relationship. This book thus emphasizes the significance of mediation and a dynamic approach to understanding this complex issue, contributing to a better understanding of the mechanisms that can enhance firms' financial performance.

This book holds immense interest for corporate finance, management, and economics researchers, as well as policy makers. It provides valuable insights for postgraduate research students in corporate governance and corporate finance, who can apply econometrics to analyze multi-dimensional and complex issues within the firm, including ownership structure, agency problems, corporate risk management, and financial performance.

In conclusion, the relationship between ownership structure and firm performance is a multifaceted and intricate topic that has been extensively studied. By adopting the mediation (path) analysis and recognizing the roles of agency costs and corporate risk-taking, this book offers a fresh perspective and contributes to our understanding of the mechanisms that drive firm performance. It is a valuable resource for researchers, practitioners, and students alike, as it sheds light on the ways in which ownership structure can be strategically managed to enhance financial outcomes.

Weight: 453g
Dimension: 229 x 152 (mm)
ISBN-13: 9781032186900