EconPapers    
Economics at your fingertips  
 

Corporate ownership and the information content of earnings in Poland

Adriana Korczak and Piotr Korczak

Applied Financial Economics, 2009, vol. 19, issue 9, 703-717

Abstract: In this article we test the influence of ownership structure on the information content of earnings in Polish-listed companies. Our investigation is based on the notion that in a weak corporate governance environment expropriation of private benefits of control is pervasive and manipulation of financial disclosure is a way to conceal those benefits to avoid disciplinary action. Concentrated ownership can act as a substitute for missing country-level corporate governance mechanisms to limit acquisition of private benefits of control, reducing incentives to mispresent financial situation and thus improving the quality of public accounting information. We find that weak country-level corporate governance mechanisms in the transition environment are best substituted by concentrated holdings of several investors rather than a single large shareholder. The information content of earnings increases when a few blockowners jointly hold between 25 and 50% of voting rights. We argue that the overall beneficial effects on corporate governance practices come from each blockholder's incentives to protect themselves from being expropriated by managers and other blockholders. We also find a positive impact of managerial holdings on the information content of earnings, and we argue that the holdings effectively align managers' and investors' interests.

Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.tandfonline.com/doi/abs/10.1080/09603100802167247 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:apfiec:v:19:y:2009:i:9:p:703-717

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAFE20

DOI: 10.1080/09603100802167247

Access Statistics for this article

Applied Financial Economics is currently edited by Anita Phillips

More articles in Applied Financial Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().

 
Page updated 2025-03-20
Handle: RePEc:taf:apfiec:v:19:y:2009:i:9:p:703-717