The Structure of Corporate Holdings and Corporate Governance: Evidence from India

Swarnodeep Homroy and Shantanu Banerjee

No 84979625, Working Papers from Lancaster University Management School, Economics Department

Abstract: This paper examines how the structure of corporate holdings impacts upon the corporate governance mechanisms and outcomes. Using a panel data of 500 large listed Indian …firms we compare …firms with dispersed equity ownership, and business group …firms with cross-holdings and concentrated family ownership, within the same institutional frameworks. Contrary to the popular hypothesis that concentrated shareholding leads to worse corporate governance outcomes, we find that the corporate governance outcomes are similar for both types of …firms, even though the incentive alignment mechanisms may be different. The results of this paper suggest that corporate holding structures and governance mechanisms adjusts to optimize value and performance.

Keywords: business groups; corporate governance; concentrated share ownership; corporate holding structure (search for similar items in EconPapers)
JEL-codes: G15 G28 G32 (search for similar items in EconPapers)
Date: 2015
New Economics Papers: this item is included in nep-bec and nep-cfn
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