Corporate ownership and governance practices in Canada: a longitudinal study

Abstract

The objective of this study is to analyse convergence of corporate governance in Canada in a period characterised by high financial uncertainty (1999–2008). The methodological strength of this study resides in the combination of a longitudinal approach with a multilevel analysis, focusing on both governance practices and ownership structure. Our results show that ownership structure and control did not change over time. Canadian firms remained controlled by an ultimate shareholder who often is in a position to enjoy all of the private benefits of control while internalising only a small fraction of the costs. However, corporate governance practices converged toward a US model over the period under investigation, overall lending support to functional convergence, not formal convergence.