IDEAS home Printed from https://ideas.repec.org/a/aic/revebs/y2018j21tarana.html
   My bibliography  Save this article

Influence Of Local Versus Foreign Corporations, As Shareholders, On Financial Performance Of Romanian Listed Companies

Author

Listed:
  • ALINA TARAN

    () (Alexandru Ioan Cuza University of IaÅŸi, Doctoral School of Economics and Business Administration, IaÅŸi, Romania and Izmir University of Economics, Faculty of Business, Izmir, Turkey)

  • MARILENA MIRONIUC

    () (Alexandru Ioan Cuza University of IaÅŸi, Faculty of Economics and Business Administration, IaÅŸi, Romania)

Abstract

In the actual context of global mobility of investors and capitals, diverse categories of local and foreign shareholders (institutional investors, governmental agencies, corporations or individual investors) influence business activities, management and results of the owned entities. Shareholders’ monitoring ability is related to their interests and their involvement in the investee’s business. This study contributes to the on-going debate referring to local and foreign shareholders and investigates the influence of both local and foreign corporate shareholders on financial performance of Romanian listed companies during 1997-2016. Results of fixed-effects panel regression analysis reveal that local corporations positively influence the profitability of their affiliates, as measured by ROE. However, foreign corporate shareholders do not significantly influence financial performance of Romanian entities. Thus, the expected benefits associated with foreign ownership do not enhance the performance of local companies. These findings helps future privatisation or investment decisions in Romanian listed companies. Moreover, the results raise further questions regarding the interests of foreign companies investing in Romanian stock market.

Suggested Citation

  • Alina Taran & Marilena Mironiuc, 2018. "Influence Of Local Versus Foreign Corporations, As Shareholders, On Financial Performance Of Romanian Listed Companies," Review of Economic and Business Studies, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, issue 21, pages 97-116, June.
  • Handle: RePEc:aic:revebs:y:2018:j:21:tarana
    as

    Download full text from publisher

    File URL: http://rebs.feaa.uaic.ro/articles/pdfs/258.pdf
    Download Restriction: no

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alina ȚARAN, 2019. "Corporate ownership and capital structure: evidence from Romania," Eastern Journal of European Studies, Centre for European Studies, Alexandru Ioan Cuza University, vol. 10, pages 133-150, June.

    More about this item

    Keywords

    corporate shareholders; foreign ownership; ROA; ROE;
    All these keywords.

    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aic:revebs:y:2018:j:21:tarana. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sireteanu Napoleon-Alexandru). General contact details of provider: http://edirc.repec.org/data/feaicro.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.