Volume : IV, Issue : XI, November - 2015

Ownership Structure and Family Grouping: Potential Expropriation via Dividends

Yoser Gadhoum

Abstract :

 The purpose of this paper is to examine a number of aspects of management and financial management in family controlled and group affiliated firms in Canada. The main purpose of this research is to examine whether large shareholders can and do exploit their position to the disadvantage of smaller, independent investors. Using data from a range of financial sources, the study examines the behavior of family owned, group affiliated and independent firms to see whether there are differences in policies, particularly related to the question of payment of dividends. A series of logit regression models are used in testing the hypotheses that family owned companies differ in relation to these policies. The findings show that there is little evidence that large shareholders use their power directly to expropriate small shareholders, although there is evidence that large shareholders exert excessive influence over the policy relating to dividend payments. The findings suggest that some subtle uses of power by major shareholders are at play in determining company policy, and this may be of practical interest to market regulators in assessing whether small shareholders are sufficiently protected. The paper explores an area which has received relatively little attention, given the importance of the issues raised for capital markets.

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Article: Download PDF    DOI : https://www.doi.org/10.36106/gjra  

Cite This Article:

Yoser Gadhoum Ownership Structure and Family Grouping: Potential Expropriation via Dividends Global Journal For Research Analysis, Vol: 4, Issue: 11 November 2015

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