Ownership and Control: Dissecting the Pyramid

Ariane Chapelle () and Ariane Szafarz

No 03-002.RS, Working Papers CEB from Université Libre de Bruxelles, Solvay Brussels School of Economics and Management, Centre Emile Bernheim (CEB)

Abstract: Pyramids, cross-ownership, rings and other complex features are frequent in the European and Japanese industrial world. The dissection of these structures requires a proper measurement of indirect shareholdings. While some authors use the (generally overestimated) data coming from legal ownership declarations, Ellerman (1991) and Flath (1992), Baldone et al. (1997) use the input-output matrix technology applied to raw ownership data. This paper goes a step further by adding control considerations based on the majority voting rule. The analysis moves from integrated ownership towards integrated control (including chain effects), then defines a control ratio for ultimate shareholders of any firm. The methodology is illustrated on Albert Frère's pyramidal empire. By offering a way to evaluate control leverages, this paper provides a useful tool for empirical research in corporate governance.

Keywords: Integrated ownership; Corporate control; Corporate governance. (search for similar items in EconPapers)
JEL-codes: J33 J41 M12 (search for similar items in EconPapers)
Date: 2002-12
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http://www.solvay.edu/EN/Research/Bernheim/documents/wp03002.pdf First version, 2002 (application/pdf)

Related works:
Working Paper: Ownership and control: dissecting the pyramid (2003)
Working Paper: Ownership and control: dissecting the pyramid (2003)
Working Paper: Ownership and control: dissecting the pyramid (2002)
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Persistent link: http://EconPapers.repec.org/RePEc:sol:wpaper:03-002

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