IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

The dynamics of voting ownership in lone-founder, family-founder, and heir firms

  • Achleitner, Ann-Kristin
  • Kaserer, Christoph
  • Kauf, Tobias

We examine ownership dynamics in listed founding-family firms over the period 1996–2008. In order to enlarge the understanding of persistence of ownership influence, we analyze determinants of change in the light of family-firm heterogeneity. We detect ownership decreases and increases, alike. A Large Drop of ownership (at least −2.5%) occurs 4 times as often as a Large Increase. The mean negative change is −3.1% (median 0.0%), positive changes average 0.6% (median 0.0%). Foremost, owner identity characteristics and management board participation of individual blockholders explain the likelihood of ownership dynamics. Specifically, Lone Founder Firms show the most dynamical ownership structures in all regression scenarios. Heir Firms have the most robust ownership structure and are – on average – majority controlled by a family. They are less likely to reduce their ownership influence. Family Founder Firms are only changing ownership when the family forgoes to comply with the blocking minority of 25% plus one share further. We interpret all results in the light of identity, agency, stewardship, and financial theory. Thereby, an unbalanced panel (2529 firm years) of founding-family firms listed in the German CDAX market index at Frankfurt Stock Exchange (FSE) represents the empirical foundation.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.sciencedirect.com/science/article/pii/S1877858512000204
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Elsevier in its journal Journal of Family Business Strategy.

Volume (Year): 3 (2012)
Issue (Month): 2 ()
Pages: 79-96

as
in new window

Handle: RePEc:eee:fambus:v:3:y:2012:i:2:p:79-96
Contact details of provider: Web page: http://www.elsevier.com/wps/find/journaldescription.cws_home/719791/description#description

Order Information: Postal: http://www.elsevier.com/wps/find/journaldescription.cws_home/719791/bibliographic
Web: http://www.elsevier.com/wps/find/journaldescription.cws_home/719791/bibliographic

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 1998. "Corporate Ownership Around the World," Harvard Institute of Economic Research Working Papers 1840, Harvard - Institute of Economic Research.
  2. Melinda Muth & Lex Donaldson, 1998. "Stewardship Theory and Board Structure: a contingency approach," Corporate Governance: An International Review, Wiley Blackwell, vol. 6(1), pages 5-28, 01.
  3. Andrei Shleifer & Robert W. Vishny, 1995. "A Survey of Corporate Governance," Harvard Institute of Economic Research Working Papers 1741, Harvard - Institute of Economic Research.
  4. Mazzi, Chiara, 2011. "Family business and financial performance: Current state of knowledge and future research challenges," Journal of Family Business Strategy, Elsevier, vol. 2(3), pages 166-181.
  5. Clifford G. Holderness, 2009. "The Myth of Diffuse Ownership in the United States," Review of Financial Studies, Society for Financial Studies, vol. 22(4), pages 1377-1408, April.
  6. Shleifer, Andrei & Vishny, Robert W., 1986. "Large Shareholders and Corporate Control," Scholarly Articles 3606237, Harvard University Department of Economics.
  7. Faccio, Mara & Lang, Larry H. P., 2002. "The ultimate ownership of Western European corporations," Journal of Financial Economics, Elsevier, vol. 65(3), pages 365-395, September.
  8. Adams, Renée & Almeida, Heitor & Ferreira, Daniel, 2009. "Understanding the relationship between founder-CEOs and firm performance," Journal of Empirical Finance, Elsevier, vol. 16(1), pages 136-150, January.
  9. Jean Helwege & Christo Pirinsky & René M. Stulz, 2007. "Why Do Firms Become Widely Held? An Analysis of the Dynamics of Corporate Ownership," Journal of Finance, American Finance Association, vol. 62(3), pages 995-1028, 06.
  10. Anderson, Ronald C. & Duru, Augustine & Reeb, David M., 2009. "Founders, heirs, and corporate opacity in the United States," Journal of Financial Economics, Elsevier, vol. 92(2), pages 205-222, May.
  11. Cronqvist, Henrik & Fahlenbrach, Rudiger, 2007. "Large Shareholders and Corporate Policies," Working Paper Series 2006-14, Ohio State University, Charles A. Dice Center for Research in Financial Economics.
  12. Fahlenbrach, Rudiger & Stulz, Rene, 2008. "Managerial Ownership Dynamics and Firm Value," Working Paper Series 2007-12, Ohio State University, Charles A. Dice Center for Research in Financial Economics.
  13. Eddleston, Kimberly A. & Kellermanns, Franz W., 2007. "Destructive and productive family relationships: A stewardship theory perspective," Journal of Business Venturing, Elsevier, vol. 22(4), pages 545-565, July.
  14. Morck, Randall & Shleifer, Andrei & Vishny, Robert W., 1988. "Management ownership and market valuation : An empirical analysis," Journal of Financial Economics, Elsevier, vol. 20(1-2), pages 293-315, January.
  15. Heiss, Florian & Köke, Jens, 2001. "Dynamics in ownership and firm survival: evidence from corporate Germany," ZEW Discussion Papers 01-63, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  16. Benson, Bradley W. & Davidson III, Wallace N., 2009. "Reexamining the managerial ownership effect on firm value," Journal of Corporate Finance, Elsevier, vol. 15(5), pages 573-586, December.
  17. Goergen, M. & Manjon, M.C. & Renneboog, L.D.R., 2004. "Recent Developments in German Corporate Governance," Discussion Paper 2004-123, Tilburg University, Center for Economic Research.
  18. Belén Villalonga & Raphael Amit, 2009. "How Are U.S. Family Firms Controlled?," Review of Financial Studies, Society for Financial Studies, vol. 22(8), pages 3047-3091, August.
  19. Morten Bennedsen & Kasper Meisner Nielsen & Francisco Pérez-González & Daniel Wolfenzon, 2007. "Inside the Family Firm: the Role of Families in Succession Decisions and Performance," The Quarterly Journal of Economics, MIT Press, vol. 122(2), pages 647-691, 05.
  20. Klasa, Sandy, 2007. "Why Do Controlling Families of Public Firms Sell Their Remaining Ownership Stake?," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 42(02), pages 339-367, June.
  21. Irava, Wayne J. & Moores, Ken, 2010. "Clarifying the strategic advantage of familiness: Unbundling its dimensions and highlighting its paradoxes," Journal of Family Business Strategy, Elsevier, vol. 1(3), pages 131-144, September.
  22. Andres, Christian, 2008. "Large shareholders and firm performance--An empirical examination of founding-family ownership," Journal of Corporate Finance, Elsevier, vol. 14(4), pages 431-445, September.
  23. Fama, Eugene F & Jensen, Michael C, 1983. "Separation of Ownership and Control," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 301-25, June.
  24. Miller, Danny & Le Breton-Miller, Isabelle & Lester, Richard H. & Cannella Jr., Albert A., 2007. "Are family firms really superior performers?," Journal of Corporate Finance, Elsevier, vol. 13(5), pages 829-858, December.
  25. Wright, Mike & Kellermanns, Franz W., 2011. "Family firms: A research agenda and publication guide," Journal of Family Business Strategy, Elsevier, vol. 2(4), pages 187-198.
  26. Habbershon, Timothy G. & Williams, Mary & MacMillan, Ian C., 2003. "A unified systems perspective of family firm performance," Journal of Business Venturing, Elsevier, vol. 18(4), pages 451-465, July.
  27. Francisco Pérez-González, 2006. "Inherited Control and Firm Performance," American Economic Review, American Economic Association, vol. 96(5), pages 1559-1588, December.
  28. Danny Miller & Isabelle Le Breton‐Miller & Richard H. Lester, 2011. "Family and Lone Founder Ownership and Strategic Behaviour: Social Context, Identity, and Institutional Logics," Journal of Management Studies, Wiley Blackwell, vol. 48(1), pages 1-25, January.
  29. Zhou, Xianming, 2001. "Understanding the determinants of managerial ownership and the link between ownership and performance: comment," Journal of Financial Economics, Elsevier, vol. 62(3), pages 559-571, December.
  30. Roberto Barontini & Lorenzo Caprio, 2006. "The Effect of Family Control on Firm Value and Performance: Evidence from Continental Europe," European Financial Management, European Financial Management Association, vol. 12(5), pages 689-723.
  31. Block, Joern H. & Jaskiewicz, Peter & Miller, Danny, 2011. "Ownership versus management effects on performance in family and founder companies: A Bayesian reconciliation," Journal of Family Business Strategy, Elsevier, vol. 2(4), pages 232-245.
  32. Villalonga, Belen & Amit, Raphael, 2006. "How do family ownership, control and management affect firm value?," Journal of Financial Economics, Elsevier, vol. 80(2), pages 385-417, May.
  33. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
  34. Stijn Claessens & Simeon Djankov & Joseph P. H. Fan & Larry H. P. Lang, 2002. "Disentangling the Incentive and Entrenchment Effects of Large Shareholdings," Journal of Finance, American Finance Association, vol. 57(6), pages 2741-2771, December.
  35. Ross, Stephen A, 1973. "The Economic Theory of Agency: The Principal's Problem," American Economic Review, American Economic Association, vol. 63(2), pages 134-39, May.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:eee:fambus:v:3:y:2012:i:2:p:79-96. 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: (Zhang, Lei)

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.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.