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Ownership Structure and Firm Performance: The Role of R&D

Author

Listed:
  • Irene Wei Kiong Ting

    (Department of Finance and Economics, College of Business Management and Accounting, Universiti Tenaga Nasional, Sultan Haji Ahmad Shah Campus)

  • Qian Long Kweh

    (Department of Accounting, College of Business Management and Accounting, Universiti Tenaga Nasional, Sultan Haji Ahmad Shah Campus)

  • Hooi Hooi Lean

    (Economics Program, School of Social Sciences, Universiti Sains Malaysia)

  • Jin Hwa Ng

    (Tenaga Nasional Berhad, Financial Planning Department)

Abstract

This study aims to examine the impact of ownership structure (i.e. family ownership, government ownership, and foreign ownership) on firm performance, viz. Tobin’s Q and return on assets. The impact of R&D on the relationship between ownership structure and firm performance is also assessed using a sample of 201 Malaysian public listed companies for the period of 2002-2011. Findings show that family ownership and foreign ownership positively relate to firm performance, but not government ownership. More importantly, R&D strengthens the relationship between family ownership and foreign ownership with firm performance respectively. While prior studies have shown that ownership structure is related to firm performance, this paper contributes to a new understanding of the role of R&D in moderating the relationship between ownership structure and firm performance.

Suggested Citation

  • Irene Wei Kiong Ting & Qian Long Kweh & Hooi Hooi Lean & Jin Hwa Ng, 2016. "Ownership Structure and Firm Performance: The Role of R&D," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 8(4), pages 1-21, October.
    • Handle: RePEc:umk:journl:v:8:y:2016:i:4:p:1-21
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    File URL: http://ijie.um.edu.my/filebank/published_article/10240/Ownership%20Structure%20and%20Firm%20Performance-The%20Role%20of%20R&D.pdf
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    Citations

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    Cited by:

    1. Ali, Muhammad Jahangir & Biswas, Pallab Kumar & Chapple, Larelle & Kumarasinghe, Sriyalatha, 2024. "Institutional ownership and earnings quality: Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 84(C).
    2. Muhammad Usman Yousaf & Muhammad Kashif Khurshid & Aftab Ahmed & Muhammad Zulfiqar, 2019. "Empirical investigation of relationship between research and development intensity and firm performance: The role of ownership structure and board structure," International Journal of Financial Engineering (IJFE), World Scientific Publishing Co. Pte. Ltd., vol. 6(02), pages 1-27, June.
    3. Demirbağ Orkun & Demirbağ Kübra Şimşek & Batı Gülgönül Bozoğlu, 2022. "Women Entrepreneurs’ Education Level, Political Skill, and Firm Performance: Political Influence and Human Capital Theories," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 30(1), pages 40-69, March.
    4. Sari, Dyah Wulan & Restikasari, Wenny & Ajija, Shochrul Rohmatul & Tarbiyah Islamia, Haura Azzara & Muchtar, Darmawati, 2021. "The Impacts of Foreign Direct Investment and Export Expansion on the Performance of the High-Tech Manufacturing Industry," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 55(2), pages 91-105.
    5. Chee‐Hong Law & Siong Hook Law, 2024. "The non‐linear impacts of innovation on unemployment: Evidence from panel data," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 29(1), pages 402-424, January.
    6. Hanh Thi My Le & Qian Long Kweh & Irene Wei Kiong Ting & Mohammad Nourani, 2022. "CEO power and earnings management: Dual roles of foreign shareholders in Vietnamese listed companies," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(1), pages 1240-1256, January.

    More about this item

    Keywords

    Family ownership; foreign ownership; government ownership; ownership strucutre; performance; research and development (R&D);
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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