Ownership Concentration and Performance: JSE-TOP40 Perspective

Lethabo Mosimanyane () and Godfrey Marozva ()
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Lethabo Mosimanyane: University of South Africa
Godfrey Marozva: University of South Africa

Acta Universitatis Danubius. OEconomica, 2024, issue 20(1), 55-69

Abstract: This study aims to address the problem of agency cost by examining the impact of ownership concentration on the performance of the JSE-TOP40 listed companies, using the profitability and market variable. The effectiveness of ownership concentration in alleviating the agency cost issue was investigated over a period from 2010 to 2018. The findings revealed that company performance deteriorated with managerial ownership for JSE-TOP40 companies. Likewise, results showed that foreign ownership concentration negatively impacted performance. The persistence of agency costs in these companies imply that companies should continue to monitor them vigorously and apply corporate governance to the detriment of the poor performance. Further, corporate governance implication should be questioned as to its benefit extracted towards these companies.

Keywords: King reports; JSE; TOP40; managerial ownership; board of directors (search for similar items in EconPapers)
Date: 2024
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