Managerial incentives and strategic choices of firms with different ownership structures

Shantanu Banerjee, Swarnodeep Homroy

    OnderzoeksoutputAcademicpeer review

    11 Citaten (Scopus)
    77 Downloads (Pure)

    Samenvatting

    We examine how ownership structure affects managerial incentive alignment mechanisms and strategic objectives. We compare large Indian firms with dispersed equity ownership with business-group affiliates operating within the same institutional frameworks. We find that the performance sensitivity of CEO pay and turnover differ significantly across group affiliates and stand-alone firms. The strategic choices of firms also differ in response to managerial incentives. However, we find that, regardless of those differences, firm performance is similar for both types of firms. Overall, this paper suggests that ownership structure and managerial incentives can adjust to optimize strategic choices and firm performance. (C) 2017 Elsevier B.V. All rights reserved
    Originele taal-2English
    Pagina's (van-tot)314-330
    TijdschriftJournal of Corporate Finance
    Volume48
    DOI's
    StatusPublished - feb-2018

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