Majority Ownership Research Articles

Forging Their Own Path to the Labor Market: Hispanic Women Business Owners in North Carolina

Hispanic women are an understudied entrepreneurial population with considerable potential for economic impact. Our study uses fieldwork and semistructured interviews with entrepreneurs and community informants to understand the experiences of Latina business owners in North Carolina. We focus specifically on their entry into the formal economy as majority owners of for-profit ventures. Social location of owners is discussed to appreciate how the intersectional position of Hispanic women in the market economy shapes their entrepreneurial trajectories. Building on prior research on the “embedded market” and “gendered capital,” our study confirms that entrepreneurial succession and employment opportunities and constraints are strong motivators for Hispanic women to start businesses. However, we also identify a new catalyst for business entry that we call “social ventures and passions,” a finding that challenges the conventional assumption that immigrant and ethnic entrepreneurs open businesses primarily as an economic survival strategy or as an appeal to cultural norms (i.e., ethnic labor market approaches).

American Military Veteran Entrepreneurs: A Comprehensive Profile of Demographic, Service History, and Psychosocial Characteristics

American military veterans are nearly twice as likely to be self-employed compared with nonveterans and are majority owners in 9% of all businesses nationwide. Despite their contribution to the broader economy and the potential for training programs to cultivate and foster successful self-employment and veteran-lead entrepreneurial ventures, research on veteran entrepreneurs remains limited. To gain a better understanding of the potential strengths and vulnerabilities of veteran entrepreneurs, the current study utilized data from a large, nationally representative sample to profile self-employed veterans (n = 230) and compare them with veterans who work as employees (n = 1,055) with respect to demographic, military service history, and psychosocial characteristics. Results indicated that self-employed veterans were older and more educated and more likely to utilize U.S. Department of Veteran’s Affairs (VA) health care. Self-employed veterans were more likely to serve in Vietnam and to serve in the military for fewer years. No differences were noted in perceived military experience, level of combat exposure, or military branch served as a function of self-employment. Although reporting more lifetime traumas, self-employed veterans did not experience higher rates of current or lifetime psychopathology or lower perceived quality of life. Potential protective resilience-promoting factors may be associated with the higher levels of openness, extraversion, optimism, achievement-orientation (purpose in life), and greater need for autonomy and professional development observed among self-employed veterans. Moreover, self-employed veterans demonstrated higher levels of gratitude, community integration, and altruistic service to others. Findings have potential to inform human resources management strategies and vocational training and reintegration initiatives for veterans.

Greasing the Wheels of Commerce? Corruption and Foreign Investment

There are considerable scholarly debates regarding the real consequences of corruption. Recent studies have argued that predictable corruption, in which bribers are guaranteed the delivery of government services, is less distortionary and more efficiency-enhancing than arbitrary corruption in which officials engage in simple plunder. Yet, the empirical evidence is mixed. Leveraging a vignette experiment embedded in an original firm survey in China, we find that overseas investors always consider corruption detrimental. There is some evidence that high-productivity and fixed-asset intensive investors might view predictable corruption more favorably than arbitrary corruption. Additionally, we find that compared to arbitrary corruption, predictable corruption is not associated with a significantly higher probability of market entry, but it increases the likelihood of majority ownership. Overall, the results provide little evidence that corruption greases the wheels of commerce even in a most likely case, and suggest that the perceived benefits of predictable corruption are limited.

To Bribe or Not to Bribe? Corruption Uncertainty and Corporate Practices

Using a large sample of private firms over the period from 2001 to 2013, we study the effect of corruption uncertainty on corporate investments and cash holdings. We find that a higher uncertainty about the level of corruption is associated with lower corporate investments and lower cash holdings. These results are sensitive to the ownership structure of a firm. Firms with no foreign majority ownership appear to be more sensitive to corruption-induced uncertainty than majority-controlled foreign firms. They significantly decrease their investments and cash holdings. We hypothesize that they move their cash off-balance-sheet to create cash reserves as the uncertainty of when, whom, and how much to bribe increases.

The impact of equity ownership groups on investment: Evidence from Ukraine

We empirically investigate the impact of different ownership groups on companies’ investment in Ukraine with a novel dynamic investment model where investment is based on present and historical levels of profitability (market-to-book value of equity) and lagged investment. Groups include state, insider, non-domestic, financial and financial and industrial group (FIG) ownership. Contrary to the literature, we find that the past level of profitability significantly affects investment; the majority presence of and increases in state ownership have a negative impact on firms’ investment, as is the case for non-domestic and financial companies’ ownership. Insider and FIG ownership have no impact on investment. We explain the results by the extent of liquidity concerns (hard and soft budget constraints), measured by cash flow interacted with a dummy variable of majority ownership of the respective group, and the extent of asset stripping for the corresponding ownership group and relate them to over- and under-investment, and to the free cash flow or cash constraint hypothesis.

THE STRUCTURAL EVOLUTION OF THE BANKING SYSTEM IN ROMANIA UNDER THE IMPACT OF FDI

Foreign banks represent important channels for the transfer of productive resources, managerial and organizational skills and experience accumulated on international level, which led to increased competition in the banking market in Romania, which contributed to some extent to the profitability of the Romanian banking sector. The purpose of the current attempt of research is the analysis of the structural evolution of the banking sector in Romania, under the impact of foreign direct investments (FDI). Analyzing the structural evolution of the Romanian banking sector, there can be observed that in 2015, FDI has influenced some important merger operations on a level with branches of foreign banks in Romania, and over 85% of the total capital of the banking system in our country belongs to credit institutions with foreign majority ownership and to their branches. Regarding the origin of the foreign capital of credit institutions, it originates from the member states of the European Union (EU). It is also worthy of note that in 2015, the top ten banks in the banking sector of Romania held 71.6% of the assets, while the remaining 26 banks held a share of only 28.4% of the market. Banca Comercială Română, BRD - Groupe Société Générale and Banca Transilvania are in 2015 the main banks in the Romanian banking system, with a major market share.

Dopady vlastnické struktury, firemních charakteristik a krize na efektivitu českých podniků

We analyze how efficiency of firms in the Czech Republic is affected by their size, age, competition, capital structure, ownership types, and global financial crisis. We employ the stochastic frontier approach, use a large and detailed dataset, and cover time span 2001-2012. While effects of firm characteristics are small, the effects of ownership are economically substantial. We show that majority owners are most contributive with respect to firm's efficiency when compared to other categories we analyze. Minority owners with legally grounded power are able to impose significant efficiency improvement. The effect of the foreign ownership is strongest when foreign owners control firms with less than majority of voting power. Minority owners sharing the control do not seem to contribute to efficiency. The impact of crisis is not balanced but can be regarded as marginally positive in general. The firms' characteristics change only a little. In contrast, worsening impact of the crisis is evidenced for controlling ownership categories. Minority owners exhibit a limited disciplining effect to improve efficiency after the crisis, though.

The Effect of Ex Post Risks on Post-M&A Performance Efficiency

This article undertakes an empirical analysis of M&A-related risks based on evidence from eight listed U.S. bank holding companies over the period 2000-10. The research model is designed as an inter-domain risk matrix encompassing idiosyncratic and systematic risks underlying horizontal and conglomerate M&A. Risk impact is measured by critical performance metrics at corporate and environmental levels in the pre- and post-M&A periods. It was found insignificant relationship between synergy and concentration and marginal priority of financial over operating synergy in the post-M&A realm. While systematic risk can be mitigated by horizontal M&A followed by majority ownership, its adverse effect is insurmountable for institutions resulted from conglomerate M&A.

Ecological Civilization and the New Enlightenment

Ecological Civilization and the New Enlightenment

Does One Belt One Road Strategy Promote Chinese Overseas Direct Investment?

In response to the One Belt One Road (OBOR) initiative, China’s overseas direct investment (ODI), especially mergers and acquisitions, rose significantly in the belt-road countries, especially the land-based ones. Comparatively speaking, state-controlled acquirers played a leading role in infrastructure sectors, whereas the non-state-controlled acquirers were particularly active in non-infrastructure sectors. Central and West Asia, Western Europe and Russia are favorable destinations of Chinese ODI in the belt-road countries. The host countries have adopted a positive and friendly attitude toward Chinese acquisitions. The whole or majority ownership acquisitions rose significantly, and an increasing number of state-controlled targets were acquired by Chinese enterprises.

Property and the Institutional Investor in Ireland

The built environment exists to accommodate the specialised functions characteristic of urban areas, and its development depends upon the capacity of built space to act as a vehicle for generating profits for those interests associated with the property sector. As an industry which ties up large quantities of capital in a fixed form over a long time period, it requires long term investors to fund such activity. In recent years, pension funds and life assurance companies have emerged as major owners of urban land and buildings in Ireland, and this paper investigates the rationale for their engagement in the property sector.

Sovereign Wealth Funds, Globalization of Capital Markets, and Internationalization Strategies

In this work, we study the strategies driving cross-border sovereign wealth fund (SWF) investments worldwide. In particular, we investigate how SWFs internationalize their activities, studying whether the use of investment vehicles as signal of passive investment approach to access foreign markets is influenced by SWF- and deal-specific characteristics and the presence of bilateral trade agreements between the SWF’s and the target country. We use a new dataset on SWF investments, whose size is comparable with the datasets used in the most popular SWF studies. Our probit and multinomial logit estimates show that fund opacity, fund politicization, strategic industry targets, and majority ownership choices lead to a more likely use of vehicles, while bilateral trade agreements negatively affect such investment strategy. When we disentangle the different types of vehicles and their geographical location, we find that fund opacity increases the likelihood to use SWF-controlled vehicles, while fund politicization, strategic industry targets, and majority ownership choices increase the likelihood to use a corporate vehicle. While, bilateral trade agreements reduce the use of corporate vehicles. As to the geographic location of the vehicle, politicized foreign SWFs are more likely to invest through vehicles located in third countries. Instead, targeting strategic industries leads to invest in vehicles located in the target country. Our results control for SWFs’ strategic goals, SWF experience (reliance on external managers or advisors, fund size), type of funding sources, crisis period, deal-specific effects, and legal and institutional differences across countries and over time.

Formal and real ownership structure of the Polish economy: state-owned versus state-controlled enterprises

This article analyses the difference between the state’s formal and real shares in the Polish economy. We identify two basic types of corporate control exercised by the state over enterprises through ownership (in the case of majority ownership) and non-ownership tools (in the case of minority ownership). Consequently, we distinguish between two types of state enterprises: state-owned enterprises (SOEs) and state-controlled enterprises (SCEs). In post-communist economies, SCEs mainly originate from so-called reluctant privatisation, in which the transfer of ownership rights takes place without the appropriate transfer of control rights. We discuss the tools of non-ownership control used by the state. Our estimates of the real share of state enterprises in the Polish economy (which include both SOEs and SCEs) show that it is almost two times higher than the formal share (only SOEs). The share of state enterprises is also highest in the group of Poland’s largest and most important firms. We conclude that the real importance of state enterprises in the Polish economy is much higher than might be expected if only the formal share of state ownership is taken into account.

Sovereign Wealth Funds' Internationalization Strategies: The Use of Investment Vehicles

In this paper, we examine the strategies used by sovereign wealth fund (SWF) investments in their cross-border investments. We investigate how SWFs internationalize their activities, specifically whether the use of investment vehicles as signal of passive investment approach to access foreign markets is influenced by SWF- and deal-specific characteristics and the presence of bilateral trade agreements between the SWFs and the target country. Our probit and multinomial logit estimates show that fund opacity, fund politicization, strategic industry targets, and majority ownership choices lead to a more likely use of vehicles, while bilateral trade agreements negatively affect such investment strategy. We also find that fund opacity increases the likelihood to use SWF-controlled vehicles, while fund politicization, strategic industry targets, and majority ownership choices increase the likelihood to use a corporate vehicle. Bilateral trade agreements reduce the use of corporate vehicles. Our results also indicate that politicized foreign SWFs are more likely to invest through vehicles located in third countries. On the other hand, when strategic industries are targeted, investment vehicles are likely to be located in the target country. Our results control for SWFs' strategic goals, SWF experience (reliance on external managers or advisors, fund size), type of funding sources, crisis period, deal-specific effects, and legal and institutional differences across countries and over time.

Black Entertainment Television:Impact of Corporate Ownership on Black Media

In 2001, CEO and owner of Black Entertainment Television (BET) Bob Johnson, sold majority ownership to Viacom with much controversy. Many people in the black community questioned the appropriateness of a network that claimed to represent black life being under the defacto control of a white dominated corporation. This study seeks to assess the impact of the change in ownership upon the way African Americans are represented in BET's programming. The study begins by placing black popular cultures roots in the minstrel show and shows how that form of media continues to plague American popular culture, and indeed, BET, today. The study then undertakes an interpretive textual analysis to show that BET shows and programming, under the ownership of a white corporation is used as a mechanism of white imperialistic ideological domination.

Management of Overseas Acquisitions by Developing Country Multinationals and Its Performance Implications: The Indian Example

Developing-country multinationals (DMNCs) make overseas acquisitions to leverage extant capabilities of acquired companies in order to enter foreign markets and acquire their know-how to enhance their own competitiveness against global competition at home and abroad. We go “inside the black box” to examine how DMNCs manage those acquisitions and the attendant implications for postacquisition performance. When DMNCs keep the acquired firm “structurally separate” from their own organization and retain its senior executives, they exhibit better acquisition performance. Also, “linking mechanisms” to coordinate interdependencies between the two firms improves performance, especially when the acquired firm is kept structurally separate. Analyses of large-sample data of Indian DMNCs’ overseas acquisitions show that DMNCs’ light-handed approach to managing acquisitions, despite acquiring majority ownership in them, seems suited to their acquisition objectives. © 2016 Wiley Periodicals, Inc.

Portfolio management and appropriation of private benefits of control

<p dir="LTR">In many countries around the globe, portfolio managers utilize well accepted models, assuming that a partial stake of ownership is proportionally valued. This assumption is incorrect in markets in which traded firms or publicly held firms are controlled by major owners who would take any possible measure to protect and maintain a 'lock' on control, so they can secure a sellable asset to another control seeker. In this case, estimation of key parameters such as, volatility, expected returns and diversification effect, may be grossly distorted.</p><p dir="LTR">We would argue that a major trigger for the value of the benefits of control is the ability of control owners to transfer assets from their own portfolio to a controlled publicly traded firm. While it is obvious that these transfers will take place, if and only if, it is beneficial to the control owners, the impact on the minor shareholders may not necessarily be negative and may vary depending on several parameters. Thus, the benefits of control are not entirely "private", i.e. appropriation and diversion of the resources of publicly traded firms for the benefit of the control owners. </p><p dir="LTR">This paper aims to model the effect of the benefits of control on the value of a minority held public firms. It focuses on two related issues that are discussed in the literature on the benefits of control: what drives the value of the benefits of control, given the empirical evidence that control seekers are willing to pay a significant premium for control, and secondly, can these benefits be rationally modeled? To better understand these issues, it then models a specific drive on the part of control seekers who, in addition to their stake in a publicly traded firm, own a private portfolio. It could be argued that they may 'transfer' inferior investments to the public firms that they control exploiting less than perfect transparency. However, while they own this valuable option of 'transferring' inferior investments into the public firm, these actions may still be beneficial to the minority shareholders.</p><p dir="LTR">We establish a model and derive a simulation procedure that are applied to several cases in which transfers are made in exchange for cash or equity, instances of full disclosure or partial transparency, the likelihood that the control owners' actions will be contested in court, level of risk, and other parameters. Then we will compare the results to empirical finding. The final model will be greatly simplified so that the end formula can be easily used by practitioners. </p>

Ownership structure and financial performance of small firms in Spain

Ownership structure in companies are key to the performance, however, gaps still exist in the knowledge about the characteristics of ownership with financial performance. This study provides empirical evidence of the characteristics of ownership structure on firm’s performance. It examines 254 small and unlisted firms from the SABI database over the period 2000 to 2014. Using panel regression, the findings show that companies with family having majority ownership are more profitable and the market value such companies. The findings indicates that over performance of most firms depends on certain characteristics of their ownership. Companies with active founders perform better companies with passive founders. No significant relationship was found with respect to CEO or Chairman as founders. The presence of another block holder of ownership less than 5% is positive and significantly associated with the firm’s performance

Building Information Model for Existing Buildings for Facilities Management

The use of Building information modelling for the design and construction phase of a building has been thoroughly looked into by researchers and practitioners and there is evidence to support that it is beneficial for reducing cost, time and improving communication. Yet the potential use of BIM for the operational and management phase (Facilities management), besides maintenance schedules and equipment information and location, is still not clearly identified. The UK Government, institutional clients and major private owners are now demanding for BIM for new construction and major refurbishment but given that 70-75% of the current UK building stock will still be in use in 2050, a significant part of the existing facilities will not have an information model till the next major refurbishment, creating a major gap in the built environment. This paper presents a new framework aimed at creating information models for facilities management requiring minimal BIM skills and discusses the impact that models created for the operational stage would have on the whole life cycle of a building.

Corporate social responsibility performance in family and non-family firms: The perspective of socio-emotional wealth

What are the impacts of socio-emotional wealth on the corporate social responsibility (CSR) performance of family firms? Using panel data (2007–2012) of publicly listed firms in Taiwan, this research adopts the perspective of socio-emotional wealth to compare the CSR performance of family and non-family firms. We found that overall socio-emotional wealth (measured by majority ownership and the ratio of independent directors on the board) is positively associated with CSR performance, and family ventures out-perform non-family firms. Theoretical, managerial and policy-making implications are provided.