Influence of ownership structure and family management on the debt financing cost of brazilian publicly traded companies

Abstract

The objective of this study was to verify the influence of the structure of ownership and family management in the cost of debt financing of publicly traded companies listed in B3. For this, a descriptive, quantitative research was carried out by means of documentary analysis, with consultation to Reference Forms, Economatica database and B3 website. The sample was composed of 211 companies in 2012, 214 in 2013, 225 in 2014, 220 in 2015 and 223 in 2016. The results showed that the average cost of debt financing, in most years, was not lower in the group of companies that had a family-owned structure. However, when comparing the cost of debt financing between companies that had family and non-family management, it was noticed that, in most years, the cost was lower in the group of family-run companies. Therefore, it was found that only the family management influenced to reduce the cost of debt financing. It is concluded that companies with ownership structure and family management enjoy greater alignment of interests between the controller and the manager, in accordance with the principal-agent perspective of Agency Theory. The research contributes to strengthen the understanding of the theme in the Brazilian scenario and expands the existing discussion in the literature by addressing a factor that influences the cost of debt still little explored in Brazil. It also increases the literature in the area with empirical evidence related to the Brazilian scenario, which still lacks research of this nature.