Please use this identifier to cite or link to this item: https://hdl.handle.net/1959.11/6674
Title: The Effect of Ownership Concentration on Firm Value and Corporate Governance in Bangladesh Listed Firms
Contributor(s): Farooque, Omar  (author)orcid ; van Zijl, Tony (author); Dunstan, Keitha (author); Karim, AKM Waresul (author)
Publication Date: 2007
Handle Link: https://hdl.handle.net/1959.11/6674
Abstract: The question whether corporate governance mechanisms matter for firm's financial performance is getting momentum increasingly in the business and academic arena across the world due to the ongoing globalization process. This Paper analyses empirically governance control mechanisms, in particular Top 1 shareholder's ownership and firm performance relation in Bangladesh. Appropriate methodology (e.g., quadratic-form linear regression and two-stage least square regression model) is used on an unbalanced pooled sample of 'listed firms' with a view to modelling corporate governance mechanisms for Bangladesh corporate firms. In the context of dearth of research focusing on Bangladesh in this field, this study offers new insights into corporate governance practices in Bangladesh. Consistent with prior research, it examines ownership-performance interactions based on exogeneity and endogeneity assumption of ownership and performance variables. OLS regression documents a strong positive linear and weak non-linear relation between Top 1 shareholder's ownership and performance (market-to-book value of equity). On the other hand, 2- SLS regressions also support positive relationship between Top 1 shareholder's ownership and performance and their simultaneity. That is, a bidirectional or 'two-way' causal relationship between them is established under 2-SLS framework when endogeneity of ownership is controlled for. Following recent literature, this study endorses such bidirectional relationship between ownership and performance. A few other governance and control variables also have effect consistent with the literature. These results suggest directly strengthening of 'internal control mechanisms' and indirectly 'external sources of discipline' for corporate listed firms in Bangladesh to ensure accountability and transparency and to cope with the ongoing globalization and business development.
Publication Type: Conference Publication
Conference Details: AFAANZ 2007: Accounting and Finance Association of Australia and New Zealand 2007 Conference, Gold Coast, Australia, 1st July, 2007
Source of Publication: Presented at the 2007 Accounting and Finance Association of Australia and New Zealand (AFAANZ) Conference
Publisher: Accounting and Finance Association of Australia and New Zealand (AFAANZ)
Place of Publication: Gold Coast, Australia
Fields of Research (FoR) 2008: 150303 Corporate Governance and Stakeholder Engagement
Socio-Economic Objective (SEO) 2008: 910402 Management
Peer Reviewed: Yes
HERDC Category Description: E2 Non-Refereed Scholarly Conference Publication
Publisher/associated links: http://www.afaanz.org/afaanz_2007_call.htm
http://www.afaanz.org/openconf/afaanz/papers.php
Appears in Collections:Conference Publication

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