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Ownership structure of family business groups of Pakistan

Author

Listed:
  • SHAHID HUSSAIN

    (National University of Sciences and Technology (NUST), NUST Business School)

  • nabeel safdar

    (National University of Sciences and Technology (NUST), NUST Business School)

Abstract

This study analysis the family business groups ownership structure in the framework of corporate legal system, regulatory institutions and codes of corporate governance of Pakistan. The study uses unique handpicked data comprising a sample of 326 non-financial firms listed on Pakistan Stock Exchange for a period of 2009-13. The results reveal that Pakistani corporations have high degree of concentration of ownership. The controlling shareholders own about 87 % of firms with 10 % or more shareholding and 60 % of firms with 20 % or more shareholding. Most of the businesses are controlled by families. In 63 % of business group firms, families own 20 % or more top shareholdings. The novel contribution of the study is to develop the ownership structure of family businesses and measure the cash flow leverage, cash flow and voting rights of ultimate owners in family business groups. The study finds the considerable difference in voting and cash flow rights in family business group firms. This has strong implications for regulators, minority shareholders and dispersed investors.

Suggested Citation

  • SHAHID HUSSAIN & nabeel safdar, 2018. "Ownership structure of family business groups of Pakistan," Proceedings of Economics and Finance Conferences 7108626, International Institute of Social and Economic Sciences.
    • Handle: RePEc:sek:iefpro:7108626
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    File URL: https://iises.net/proceedings/9th-economics-finance-conference-london-uk/table-of-content/detail?cid=71&iid=006&rid=8626
    File Function: First version, 2018
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    Cited by:

    1. Imran Abbas Jadoon & Umara Noreen & Usman Ayub & Muhammad Tahir & Naima Shahzadi, 2021. "The Impact of Family Ownership on Quality and Disclosure of Internal Control in Pakistan," Sustainability, MDPI, vol. 13(16), pages 1-16, August.

    More about this item

    Keywords

    ownership structure; business group; corporate governance; cash-flow rights; minority shareholders; voting rights; family business;
    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
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation

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